Preamble

The House met at half-past Two o'clock

PRAYERS

[MR. SPEAKER in the Chair]

PRIVATE BUSINESS

FELIXSTOWE DOCK AND RAILWAY (No. 2) BILL.

Read the Third time and passed.

Chairman of Ways and Means (Statement)

The Chairman of Ways and Means (Mr. Bernard Weatherill): Among the Private Bills for which petitions were deposited on 27 November was one promoted by the Society of Lloyd's
to establish a Council of Lloyd's, to define the functions and powers of the said Council, to amend and repeal certain provisions of Lloyd's Acts 1871 to 1951, and for other purposes".
As I am a member of Lloyd's, a fact which is recorded in the Register of Members' Interests, I think it would be undesirable for me to discharge, in relation to the Lloyd's Bill, the various duties in relation to Private Bills which the Private Business Standing Orders and the practice of the House impose upon the Chairman of Ways and Means. At my request, the Deputy Chairmen have kindly agreed that one of them will act in my place in any of the proceedings relating to the Bill. I trust that this arrangement will commend itself to the House.

Oral Answers to Questions — Employment

Training Boards (Review)

Mr Moate: asked the Secretary of State for Employment when he expects to complete his review of the training boards.

The Secretary of State for Employment (Mr. James Prior): I hope next year to take decisions about the future of individual boards in the light of the findings of the review of the future training needs of each sector of industry, which I have invited the Manpower Services Commission to conduct urgently.

Mr. Moate: Is my right hon. Friend aware of the widespread feeling among a large part of industry that the training boards represent a major burden upon industry and that among all the quangos they are the biggest? When he contemplates his future plans for the boards, will he begin with the assumption that the object must be to reduce the bureaucratic and financial burden that the boards place upon industry without any commensurate results in training?

Mr. Prior: I begin with the assumption that we need to reduce the level of bureaucracy but also that we need to maintain the level of training. I am well aware of my hon. Friend's views. They are frequently expressed to me. I shall certainly examine each individual board, as I suspect the Manpower Services Commission will do also, with a critical eye to the points that my hon. Friend raised.

Mr. Wigley: Does the Secretary of State accept that often manufacturing industry benefits most from the training boards? Does he further accept that it is not unreasonable that manufacturing industry should make a substantial contribution towards the training costs because, at the end of the day, that industry reaps the benefits?

Mr. Prior: Manufacturing industry does make a substantial contribution towards costs. We are considering the costs of the operating expenses of the board which are currently paid by the Government. If the boards are to continue, the operating costs should be paid by industry. That should sharpen the views of industry as to whether they wish the boards to continue in their present form.

Mr. Stokes: Is my right hon. Friend aware that we are glad that he is to examine the individual boards, because they vary both in competence and in the respect that they have for their respective industries? Is he further aware that the best boards could survive by charging fees that industry would be glad to pay and that the others should be abolished as soon as possible?

Mr. Prior: All those points will be taken into account during the course of the review. It would be wrong for me to try in any way to prejudge the findings of the review. The Manpower Services Commission will get on with the matter. It must report by the middle of June. We shall then take fairly quick decisions, taking account of the points mentioned by my hon. Friend.

Mr. Harold Walker: What is the total amount that the secretary of State is proposing to withdraw from the boards? How much will be the additional burden imposed on industry as a consequence of his proposals? How many fewer training places will there be in industry? When will we have a full, detailed statement about these matters so that we can better understand the legislation that will be introduced?

Mr. Prior: Legislation will be brought before the House in due course. There is no reason why it should have any effect on the number being trained. We are looking for training to a more fruitful end than some of the present training and expenditure. The operating costs of the training boards, which are paid for by the Manpower Services Commission through Government grant, amount to £40 million or £50 million. On this year's adjusted basis it is about £40 million.

Northern Region

Mr. Radice: asked the Secretary of State for Employment whether he is satisfied with the progress in reducing the growth of unemployment in the Northern region.

Dr. David Clark: asked the Secretary of State for Employment what plans he has to stimulate employment in the Northern region.

The Under-Secretary of State for Employment (Mr. Jim Lester): The level of unemployment in the Northern region remains much too high. The Government recognise that areas such as the North-East require special help to overcome their particular problems.
This is why the Government provide a considerable amount of assistance to the North-East—for example, through their regional policy and through the special employment measures. In the longer term, the economic future of the North depends on a general improvement in the industrial performance of the country as a whole.

Mr. Radice: Is the hon. Gentleman aware that there are 168,000 unemployed in the Northern region, which is an increase of 43 per cent. since last year, and that there are further 23,000 on short-time working, which means that unemployment is bound to worsen? When will the Government Front Bench make the Prime Minister understand what is happening? When will it persuade the right hon. Lady to change her policies?

Mr. Lester: I am aware of those figures. I am also aware that in the Northern region we have established one enterprise zone and that we are currently considering a second one. We have offered substantial help through the Industry Act, amounting to £215 million. There have been 200 advance factories. We have expanded from 41,000 places on the youth opportunities programme this year to 57,000 in 1981–82. Surely, that is a positive response to the figures that the hon. Gentleman has quoted.

Dr. Clark: Does the hon. Gentleman realise that the appalling figures that my hon. Friend the Member for Chester-le-Street (Mr. Radice) has mentioned include terrible black spots such as Hartlepool, Consett and Sunderland and that in my own constituency one in five of the men are out of work? Does he realise also that he has managed to confirm the image of the Conservative

Party as being the party of unemployment? When will he suggest to his right hon. Friend that he should press in the Cabinet for a northern development agency?

Mr. Lester: The suggestion of a northern development agency is not a matter for my right hon. Friend. Labour Members and some of my hon. Friends have been pressing for an agency. I think that the matter is now being considered by the Department of Industry.
We are aware of the unemployment figures. The hon. Gentleman knows that I have been to his constituency. I have visited the North since then. It is not a matter of not realising and not understanding. The question is what the Government can do that they are not doing already. We need to get our industrial performance and productivity in line with our competitors. When we have done that, we shall create real jobs.

Mr. Banks: Is my hon. Friend aware that there have been press reports that there may be delays in placing shipbuilding contracts for the Royal Navy? Will he recognise the immense importance of maintaining a viable shipbuilding industry for building warships and of the employment that goes with that?

Mr. Lester: That question was raised when I went to the North-East, to Swan Hunter. I have taken it up with the Department of Industry.

Mr. Beith: Does the Minister realise that long before his right hon. Friend the Prime Minister advised people to seek work away from home many men from the North-East went to towns such as King's Lynn in Norfolk to seek work? Is he aware that they now find themselves returning to the North-East without a job, having been declared redundant on the principle of last in, first out? Does he realise that that further underlines the importance of changing the economic policies that are causing the recession in the North-East?

Mr. Lester: To change the economic policies would create worse problems in the North-East. We have problems now because Governments have been panicked by unemployment figures, which we believe are short-term transitional figures, into reflation. We have ended up with a higher base rate of unemployment than that with which we started.

Unemployment Statistics

Mr. Winnick: asked the Secretary of State for Employment if he will state the latest number of registered unemployed in the United Kingdom.

Mr. Prior: At 13 November, the number of people registered as unemployed in the United Kingdom was 2,162,874.

Mr. Winnick: Do not the figures indicate the appalling level of unemployment, including that in the West Midlands, and the human and national tragedy that is involved? Do not all the indicators demonstrate that unemployment will continue to rise sharply? Bearing in mind that the right hon. Gentleman had such a close connection with the former Prime Minister, the right hon. Member for Sidcup (Mr. Heath), would it not be wise to bear in mind his warning to the Tory Party of the connection between the Conservative Party and unemployment?

Mr. Prior: I find myself in agreement with the hon. Gentleman in so far as these are appalling figures. They are the result of 20 years of gradual decline. The same sort of questions as are now being asked of myself and my hon. Friends were being asked 20 years ago when unemployment was 3 per cent. It is now nearly 10 per cent. That suggests to my hon. Friends that the policies that have been pursued in the past, to which some Labour Members ask us to return, would be no more successful if pursued again.

Mr. Needham: Will my right hon. Friend tell the House what he believes are the practical suggestions, if any, put forward by the Labour Party towards curing these terrible figures?

Mr. Prior: As I have said, it has no policies at all.

Mr. Barry Jones: Has the right hon. Gentleman told the Cabinet that further cutbacks in steel will add to the miseries of unemployment in the North and in Wales? Is he aware that many of us on the Opposition Benches are apprehensive about the likely outcome of the current review? What is the right hon. Gentleman doing in the Cabinet on behalf of steel workers?

Mr. Prior: The important thing about the steel industry is that we should sell more steel. If we do that, we can produce more steel. It is in the marketing of steel that the present chairman of the corporation is hoping for and seeking a way out of the serious problems facing the industry. What happens in British Leyland, in the car industry and in the production of consumer durables is reflected directly in the amount of steel that we can produce and, therefore, the number of jobs in the steel industry. That is the crucial element and that is the message that I give to the hon. Gentleman and my hon. Friends.

Mr. Gordon Wilson: Does the right hon. Gentleman realise that such is the horrific proportion of unemployment in Scotland that the Scottish Trades Union Congress organised yesterday a national convention on the problem of unemployment, which was attended by about 950 representatives of industry, trade unions, political bodies and other bodies? Will he be prepared to meet the standing commission of the convention to listen sympathetically to any proposals that it might care to advance for the amelioration of unemployment in Scotland?

Mr. Prior: Subject to the demands of etiquette in my relationship with the Secretary of State for Scotland, I shall be delighted to meet either the Scottish Trades Union Congress or the standing commission. I am glad that the Conservative Party, including Conservative trade unionists, took part in the conference that met yesterday. I gather that it put up a good show.

Mr. Ralph Howell: I accept that the unemployment figures are unbearably high. However, is my right hon. Friend aware that when I visited employment exchanges that cover his constituency I was told by the managers that about one-third of those who are registered as unemployed genuinely wanted to work and that when I visited North-East labour exchanges I was told by the managers that about 45 per cent. genuinely wanted to work? What is my right hon. Friend's estimate of the percentage of those who genuinely want to work?

Mr. Prior: I can assure my hon. Friend that in my constituency the percentage is a great deal higher than he

suggests. I believe that the vast majority of British people want to work. It is a duty of society to seek to provide the maximum number of jobs. I believe also — in this I share some of the anxieties of my hon. Friend — that there are many more in society now who do not mind if they work or if they do not. There are many more who take that view now than 10 or 20 years ago. That should not allow us to forgive or forget the dramatic increase in unemployment in recent years. We must do all that we can to reduce it.

Mr. Varley: Does the right hon. Gentleman accept that by the end of the year he will have presided over the worst and most rapid rise in unemployment of any Secretary of State or Minister of Labour since the early 1930s? I do not believe that he takes any joy from that, but will he confirm that there is a secret report in the Department of Employment that indicates that by this time next year, on the basis of unchanged economic policies, we shall have unemployment reaching 3 million? Does he not regard that as appalling? What will he do to prevent that from coming about?

Mr. Prior: If it was secret, the right hon. Gentleman would not know about it. However, as there is no such report, it is not secret, and I am able to deny that there is such a report. As for the record in the past 20 months, the number of unemployed doubled in the first two years of Labour Government.

Mr. Harold Walker: Then it started to fall.

Mr. Prior: It started to fall very slightly towards the end of that period. However, neither party, nor any Western European country, has succeeded in dealing with the unemployment problem in recent years. Before suggesting the same old policies that failed last time, Labour Members should have a little more patience with the policy that we are pursuing.

Assisted Areas (Materials Allowance)

Mr. Campbell-Savours: asked the Secretary of State for Employment whether he will increase the materials allowance under the short-term employment programme and the youth opportunities programme in the European Coal and Steel Community assisted areas and the development and special development areas; and whether he will bring forward measures to reduce the period before eligibility for such schemes, in such areas.

Mr. Jim Lester: I am informed that the Manpower Services Commission intends to increase from £300 to £400 across the board the per capita materials allowance of the youth opportunities programme from 1 April 1981. The materials allowance of the new community enterprise programme will also be £400, which is £100 more than the allowance available under the special temporary employment programme, which it will replace from 1 April 1981. The six-week rule for entry to the youth opportunities programme will be retained but will be further relaxed for young people in special need.

Mr. Campbell-Savours: Does the Minister accept that increasing the material allowances in the DAs, SDAs and ECSC assisted areas will act as a considerable incentive to local authorities to set up special units to help people enter the special temporary employment programme? Does he further accept that, by bringing forward the date


of eligibility for STEP, local authorities will be enabled to use the EEC-based readaptations payment scheme, which is available in areas where there have been steel industry closures, to draw people into their schemes from the steel industry?

Mr. Lester: One is always looking at ways of getting one's hands on European money. However, to try to differentiate the allowances to target them to SDAs, DAs and so on is not helpful. Under existing schemes, they are targeted in a number of places. Over half the places available are already in such areas, which means that the cumulative money available is very much higher. The schemes operate nation-wide to deal with areas that have unemployment equally as Lad as in the SDAs, although that is often concealed in the figures. It is, therefore, not possible to pursue the policy that the hon. Gentleman puts forward to benefit his constituents.

Skill Training

Mr. Cadbury: asked the Secretary of State for Employment what additional steps he proposes to take to ensure that young people have sufficient skills for industry's future needs.

The Under-Secretary of State for Employment (Mr. Patrick Mayhew): This year some 25,000 apprenticeships are receiving aid from the Manpower Services Commission, and on 21 November my right hon. Friend announced a major expansion of the youth opportunities programme, which helps to prepare unemployed young people for working life, and an acceleration in the unified vocational preparation pregramme for employed young people. The Government and the MSC are currently considering what further action might be taken to equip young people for industry's future needs.

Mr. Cadbury: While welcoming the Government's recent moves to expand and improve the quality of the youth opportunities programme, may I ask my hon. and learned Friend to say what progress is being made to encourage industry and unions to move away from an apprenticeship system which is based more on time saving than on the achievement of certain basic standards?

Mr. Mayhew: The achievement of basic standards to equip young people for a life in industry is very important. The unified vocational preparation programme, which began in 1977 on an experimental basis, is being developed by the Manpower Services Commission, with the encouragement of my right hon. Friend. That programme provides training for young people in work aged between 16 and 18 years, and we regard it as being jest as important in its way as the youth opportunities programme.

Mr. Golding: Is the Minister aware that, given the dramatic drop in apprentice recruitment this year, the number of 25,000 places is totally inadequate? Will the Department resolve to do better next year?

Mr. Mayhew: We shall have to wait to see how resources turn out. We shall be guided by what the Manpower Services Commission has to say in that regard. The 25,000 apprenticeships at present aided by the Manpower Services Commission include 1,700 that were added to the programme in response to the rise in youth unemployment.

Mr. Ian Lloyd: Allowing for the exceptional and exceptionally important work being done in the application of microelectronics in schools in the Birmingham area, would my hon. and learned Friend care to estimate what proportion of the secondary school population of the United Kingdom is receiving some familiarisation with the technology on which their employment in the next two decades is most likely to depend?

Mr. Mayhew: My hon. Friend puts his finger on a vitally important matter. About half our secondary schools now have access to computer technology training. That is not nearly enough, and the number should be increased.

Mr. Jim Marshall: Does the Minister accept that, useful though the youth opportunities programme is, it is no substitute for real training in industry? Will he take on board the point made by my hon. Friend the Member for Newcastle-under-Lyme (Mr. Golding) that, if we are to train to meet industry's future needs, the State should provide further cash incentives because of the poor financial position of industry at present?

Mr. Mayhew: What the hon. Gentleman describes as real training in industry is very important, and it is exactly the subject of the unified vocational preparation scheme, under which employers receive incentive payments for a trainee spending a day or a block of days training away from work and, in some cases, also for workplace training. By July 1979, about 3,000 young people had taken part in that scheme. Two industry training boards — the rubber and plastics board and the distributive industry board — have introduced substantial schemes of their own.

Unemployment Statistics

Mr. Canavan: asked the Secretary of State for Employment what is the total number of unemployed people in the United Kingdom; and how many are under the age of 25 years.

Mr. Prior: At 13 November, the number of people registered as unemployed in the United Kingdom was 2,162,874. The latest date for which an age analysis of the unemployed is available is 9 October, when the total was just over 2 million and the number under 25 years of age was 855,023.

Mr. Canavan: When will the Government face the fact that a major cause of unemployment is the failure of their economic dogma, because extreme monetarism, high interest rates, high inflation, high energy costs, an overvalued pound and savage cuts in public expenditure have destroyed thousands of jobs, including jobs for people under 25? As the annual cost of unemployment is about £10 billion, is it not time that the Government invested such a sum in industry and essential services in order to provide more jobs?

Mr. Prior: I do not accept the hon. Gentleman's premise, and neither did his Government when they were in office. We are trying to help in any way possible. That is why I have announced a massive extension in the youth opportunities programme of up to 440,000 places next year. For the benefit of the hon. Gentleman and the House, may I say that the number of people being covered by various schemes is at present 668,000, which does not


include the people whose jobs are being aided in nationalised industries by the additional resources that the Government are having to put into them.

Mr. Neubert: Does my right hon. Friend agree that the slight fall in unemployment, which affected relatively few people and occurred just before the Labour Government went out of office, was paid for by rapid price increases for everyone immediately after they went out of office? Will he confirm that he has no intention of taking such a short-term and irresponsible way out of our problems?

Mr. Prior: I do not believe that taking the short-term course would have any effect on the long-term problems. That is why we are sticking to our policy. The reduction of about 100,000 in the unemployment level in 1978 and the beginning of 1979 reflected the fact that we were at the top of the economic cycle. However, we still had 1·3 million unemployed, which shows the magnitude of the problem that Britain faces.

Mr. Cyril Smith: Is the Secretary of State aware that in some areas, and certainly in my constituency, unemployment is due not simply to the streamlining of numbers in factories but to factory closures? Is he further aware that the unemployment in those areas is likely to be long-term rather than short-term? What proposals do the Government have for attracting industry to those areas? Does he not take the view that he should consult his right hon. Friend the Secretary of State for Industry about the possibility of reviewing areas that have development area status?

Mr. Prior: I am continuously in consultation with my right hon. Friend the Secretary of State for Industry on the question of reviewing areas for development area or intermediate area status. As for the hon. Gentleman's statement that a number of firms are going out of business altogether, I agree that that is one of the problems, particularly in the textile industry. That is why it is important to attract, by every means possible, other industries to take their place. That will depend partly on Britain's ability to control inflation and partly on our ability to sell our goods in overseas markets. That is a greater possibility or probability now than it has been for some years.

Mr. Hordern: Is my right hon. Friend satisfied that there are sufficient incentives for overseas firms to come to this country? Will he have a word with his right hon. Friend the Secretary of State for Industry and his right hon. and learned Friend the Chancellor of the Exchequer to see whether we could provide the sort of incentives that are given in the United States, for example, and to set up free trade zones—not enterprise zones? Will he also consider with his right hon. Friends the possibility of simplifying and reducing the rate of corporation tax?

Mr. Prior: Those matters go well beyond my portfolio, but I am prepared at any time to consult my right hon. Friends on those subjects. Of course, I am not satisfied with the present position, but, with regard to corporation tax and taxes generally on companies, we have some of the lowest forms of corporate taxes in the world, and I want everyone to know that so that they can take advantage of it.

Mr. John Grant: Which analysis of the unemployment situation does the Secretary of State prefer—that of his right hon. Friend the Prime Minister or that of his right hon. Friend the Member for Sidcup (Mr. Heath)?

Mr. Prior: I prefer that of the Government.

Occupational Mobility

Mr. Sheerman: asked the Secretary of State for Employment what steps he is taking to encourage occupational mobility among the unemployed.

Mr. Jim Lester: I am informed by the Manpower Services Commission that its plans provide for about 82,500 adults, most of them unemployed, to start training or retraining this year under the training opportunities scheme. Jobcentre self-service vacancy displays give unemployed people ready access to notified vacancies in many different occupations.

Mr. Sheerman: Is the Minister aware that, in the 18 months of Conservative Government, unemployment in Huddersfield, for example, has risen by 158 per cent.? Is it not a cruel deception for the Prime Minister to go to areas such as Wales and tell people to move if they want a job? Is he aware that my constituents who are willing to move and who obtain jobs in the South-East cannot get a council house transfer and cannot afford to buy a house because of the Government's policy on housing? The concept of occupational mobility is nonsense.

Mr. Lester: The Housing Act 1980 has made considerable changes to assist people to be mobile. The Government recognise that housing is one of the major factors in mobility. I remind the hon. Gentleman that when the Labour Government were in power they made no changes in housing policy to assist people to be mobile. With regard to adult retraining, the hon. Gentleman knows that there are skillcentres at Bradford, Wakefield and Leeds and that there are also the Huddersfield technical college and the Dewsbury and Batley technical college.

Mr. Forman: Does not my hon. Friend agree that labour mobility amongst the employed is as important to the country's future as labour mobility for the unemployed? To that extent, will he encourage the move towards the transferability of occupational pensions, which would make a great contribution to achieving that objective?

Mr. Lester: I understand that the transferability of occupational pensions is currently under review by the DHSS. Of course, it is true that mobility in a real and reasonable sense has always played a part in this country in solving employment and unemployment problems. Birmingham and the Black Country did not exist until comparatively recently in that respect.

Mr. Ashley: Is the Minister aware of the deep anxiety in North Staffordshire, where unemployment has doubled in the last year, and that the pottery industry, which was highly profitable, has been very badly hit? Instead of trying to shunt people out of these localities, why does he not take action to try to bring work back into the Potteries, where work can be done?

Mr. Lester: The Department of Industry and the various regional measures that have been introduced exist


for that purpose. However, the question concerns occupational guidance — that is, mobility between occupations, not places.

Unemployment (North-West)

Mr. Straw: asked the Secretary of State for Employment what are the present percentage rates of unemployment for(a)Blackburn,(b)the North-West; and what were the corresponding rates in May 1979.

Mr. Jim Lester: The unemployment rates in the Blackburn travel-to-work area at 13 November 1980 and 10 May 1979 were 10·6 and 6·0 per cent., respectively. The corresponding rates for the North-West region were 10·9 and 6·7 per cent. The rates are based on figures which include school leavers and are not seasonally adjusted.

Mr. Straw: Is the Minister aware that over the last 12 months in every town in North-East Lancashire—which is to lose its assistance under the Industry Act—unemployment has doubled, and in one case it has trebled? Is he concerned about that? When his right hon. Friend the Secretary of State asks for patience, and when he describes unemployment as a short-term transitional problem, as he did earlier this afternoon, will he say how long those unemployed in Blackburn and North-East Lancashire will have to wait before the rates are down to the May 1979 level?

Mr. Lester: If I could answer the hon. Gentleman's last question, I would not be Under-Secretary of State for Employment because I would be possessed of rather magical powers. We are concerned about the problems of the North-West and the problems in those particular towns. The reason why the review of the regional areas was built in was that they could be taken into account. The allocation to the North-West of 82,000 places under the youth opportunities programme in 1981–82 shows how much we recognise the seriousness of the problem.

Mr. Nicholas Winterton: I recognise the steps that my hon. Friend and his right hon. Friend have taken to reduce unemployment in the North-West and elsewhere, but does he not agree that many of those who have lost their jobs were in the the textile and paper and board industries in the North-West? Does he not also agree that we have opportunities of putting the matter right, like other EEC countries which have acted in their national interest? Will my hon. Friend urge upon the Prime Minister and his right hon. Friends steps that will preserve the manufacturing base of the North-West?

Mr. Lester: I know how passionately my hon. Friend feels about his constituency and the area around it, and he puts forward his views very strongly. Of course, in our concern for those who are losing their jobs in the textile industry we are constantly in contact with our colleagues in other Departments, putting forward views and trying to support them where we feel there is a sensible way in which we can help the industry. Of course, we are against dumping and illegal labelling, but the textile industry has also needed to rationalise.

European Community (Unemployment)

Mr. Adley: asked the Secretary of State for Employment what discussions he has had with his European Economic Community counterparts on unemployment in the Community.

Mr. Prior: I regularly discuss unemployment with my EEC colleagues, at meetings of the Council and in bilateral contacts.

Mr. Adley: As rising unemployment is a Community, not simply a British, problem, will my right hon. Friend discuss with his Community colleagues and his Government colleagues here the possibility of starting schemes—such as the Channel Tunnel—that could improve the Community infrastructure and provide employment, both in this country and in the Community?

Mr. Prior: Yes, Sir. Anything that we can do along those lines will be a step forward. Already, I hold regular consultations with Employment Ministers. However, the last conversations that I had 10 days ago were very gloomy all round.

Mr. Maclennan: Does the Secretary of State have constructive discussions with his opposite numbers about the expansion of the regional development programme, or does the Government's general opposition to increased public expenditure extend to their attitude towards increased expenditure by the Community on employment measures?

Mr. Prior: What we should really like to do is to transfer some of the funds which are at the moment devoted to the common agricultural policy to the regional fund and to the social fund. We believe that we must keep up the pressure there before we can agree to an increase in the budget as a whole.

Sir Anthony Meyer: Is it not clear that the Western world is faced with grave unemployment, for reasons of technological change, and is this not a problem which can be tackled only on a continental basis, by means of massive reconversion to more modern industries which can withstand low-cost competition?

Mr. Prior: There is a great deal in what my hon. Friend says. We should use our influence within the Community, as my right hon. Friend the Prime Minister did at the recent Community Council, in order to help to bring this about.

Disabled Persons

Mr. Neil Thorne: asked the Secretary of State for Employment if he is satisfied with the present level of employment opportunities for the disabled in industry and commerce during the current recession.

Mr. Mayhew: We should like to see more. We support the Manpower Services Commission in encouraging and assisting firms to employ disabled people. We regard that as very important. Our support for the fit for work campaign and its awards scheme reflects that concern.

Mr. Thorne: Accepting that long-term unemployment for the able-bodied can be soul destroying, and that long-term unemployment for the disabled is devastating, will my hon. and learned Friend please look into the possibility of giving greater encouragement especially to disabled people who have become unemployed through redundancy?

Mr. Mayhew: I think that my hon. Friend knows that the disablement resettlement officers of the Manpower Services Commission do their utmost to encourage employers not to make disabled people redundant. The


Manpower Services Commission is conducting a review into the quota scheme under the Disabled Persons (Employment) Act 1944. That review will very shortly be complete, and my right hon. Friend and the Commission will be considering it as soon as it is made available.

Mr. John Grant: Will the Minister accept that there is a sharp increase in the number of unemployed disabled people and, more important, that the placings are falling very considerably and proportionately to other unemployed people? Is not that undermining the very schemes that the Minister mentioned—the "Positive Policies" scheme and the fit for work campaign? When will he come to the House and tell us what are the effects of the Government's cuts on the employment of disabled people and, in particular—since he mentioned them—the effect on the number of specialist disablement resettlement officers that the Government are proposing to cut?

Mr. Mayhew: It is true that, regrettably, placings are down this year. There is no concealing the fact that, unfortunately, there is a long way to go before one can convince all employers that disabled people are in very many cases much fitter for work than is commonly supposed. But my right hon. Friend said that he was hoping to preserve the disabled resettlement service from the effects of cuts and that he would come to the House if that were not possible. The point is that these unfortunate people have to be assisted to the best of the Government's ability, and that is a commitment that we shall honour.

Economic Policy

Mr. Newens: asked the Secretary of State for Employment what effects he estimates the measures announced in the statement of the Chancellor of the Exchequer to the House on Monday 24 November will have on the level of employment.

Mr. Prior: I cannot give precise estimates as attempts to calculate the employment effects of measures such as these depend on arbitrary assumptions and on the particular economic model used.

Mr. Newens: But is it not a fact that, even taking into account the totally inadequate palliatives, the effects of the Chancellor of the Exchequer's action will be substantially to increase the level of unemployment by reducing public expenditure and by increasing the burdens on industry? Does the right hon. Gentleman recognise that even in the South-East and the most prosperous firms the Government's policy is now regarded as an unmitigated disaster?

Mr. Prior: I do not recognise the last part of what the hon. Gentleman has said. I recognise that his question reflects the outdated belief that changes in the Government's expenditure and revenues are reflected automatically in the level of unemployment. Most people now recognise that life is not as simple as that, and I should have thought that it was time the hon. Gentleman did.

Unemployed Persons (Registration)

Mr. Flannery: asked the Secretary of State for Employment what calculation he has made of the numbers of people, in particular women, who, although unemployed, are not registered as such.

Mr. Mayhew: No such calculaton has been made by my right hon. Friend. However, the general household survey and the EC labour force survey suggest that about ·33 million people, including ¼ million women, may be seeking work though not registered as unemployed and that about two-thirds of those women want work that is part-time.

Mr. Flannery: Does not the hon. and learned Gentleman realise that the real figure of unemployed is much closer to 3 million than the figure given earlier today? Does that not make the disaster far more catastrophic? What will be done in order to put cash into dying industry — the de-industrialisation of steel, for instance—in order to bring people back into work?

Mr. Mayhew: The putting of public money into industries that are dying because they have lost their markets — for example, because the markets had disappeared — will not bring down the level of the unemployed. There is only one way in which to bring down the level of the unemployed, and that is for industry to get its house in order and for this country's housekeeping to be put on a sound basis.

Oral Answers to Questions — British North America Acts

Mr. Foulkes: To ask the Prime Minister if she will arrange to meet with the Prime Minister of Canada to discuss the patriation of the British North America Acts.

The Prime Minister (Mrs. Margaret Thatcher): I have no plans to do so.

Mr. Foulkes: But does not the Prime Minister realise that we are now on a collision course with Canada? Since the Prime Minister does not have to seek her problems, will she now say to Pierre Trudeau that changes in the constitution of Canada should be decided over there and that he should now abandon his unilateral action?

The Prime Minister: We have as yet received no request from Canada. When a request comes, we shall try to deal with it as expeditiously as possible and in accordance with precedent.

Mr. Aitken: Is my right hon. Friend aware that it has been reported all over Canada that the British Government have given Mr. Trudeau some sort of commitment that they will push the 59-clause Bill through this House of Commons as quickly as possible? Will my right hon. Friend confirm or deny those reports, and will she bear in mind that constitutional issues of this complexity must surely be decided not by the Government but by Parliament as a whole?

The Prime Minister: I know of no 59-clause Bill. On 14 previous occasions this House has been asked to deal with a request from the federally elected Parliament of Canada. It has done so in accordance with well-established precedent, bearing in mind that we are an elected Parliament and that the federal Parliament of Canada is a similarly elected Parliament. When we receive the request, we shall try to deal with it as soon as we can.

Mr. George: Does the Prime Minister appreciate that there are many advisers outside the Foreign Office who have argued that, unless there is unanimity or near unanimity among the provinces, the Canadian Prime Minister should not proceed to patriate and we should not


acquiesce? If we acquiesce, we shall be reneging on constitutional obligations not only to the provinces but to the native people of Canada—people who were there 15,000 years before the French or the English ever realised that Canada existed.

The Prime Minister: If we receive a request, I believe that we have to deal with it in accordance with the statute which governs it—

Mr. English: Hear, hear.

The Prime Minister: —in accordance with precedent, and in accordance with the fact: that it is received from a fully democratically elected Parliament and would be a request from a fully democratically elected Parlament to a similarly democratically elected Parliament.

Mr. Maxwell-Hyslop: Does my right hon. Friend agree bat the only elected body that can make representations on behalf of the Canadian people to another Commonwealth Government, such as our own, is the federal Government of Canada, and that provincial Administrations cannot have any locus standi vis-à-vis the Government of the United Kingdom or the Parliament of the United Kingdom?

The Prime Minister: I believe that we can receive a request, under the relevant statute, only from the federal Parliament of Canada.

Oral Answers to Questions — Prime Minister (Engagements)

Mr. Stanbrook: asked the Prime Minister if she will list her official engagements for Tuesday 9 December.

The Prime Minister: This morning I held meetings with ministerial colleagues and others, including one with Mr. Kisiel, Deputy Prime Minister of Poland. In addition to my duties in this House, I shall be having further meetings later today, including one with the United Nations High Commissioner for Refugees and another with a group of senior French industrialists, who are here on an official visit.

Mr. Stanbrook: Will my right hon. Friend note that most people now believe that public sector pensions should not be index-linked only at the taxpayer's expense? Will my right hon. Friend confirm that action will be taken immediately after the Scott committee has reported?

The Prime Minister: As my hon. Friend pointed out, we are awaiting the report of the Scott committee on index-linked pensions in the public sector. It would be best to wait and see what the report says before committing ourselves in any way. I accept my hon. Friend's point that the existence of such pensions for a particular sector of our people is causing some concern.

Mr. Foot: Does not the right hon. Lady think that she should have included in her duties today a full and comprehensive statement to the House of Commons on her discussions yesterday in Dublin? Even at this stage, will not she agree to the request that the Opposition made throughout the morning—namely, that she should make a full statement?

The Prime Minister: No. Those discussions were part of a series of bilateral discussions with our Community partners, which are regularly undertaken with Germany, France, Italy—[Interruption.] They were not even the

first bilateral discussions to be held between the Government of the United Kingdom and the Republic of Ireland. It would be wrong to make a special statement about that particular meeting.

Mr. Foot: Will the right hon. Lady take into account that her communiqué, issued afterwards, stated:
These discussion, were … extremely constructive and significant.
Surely any extremely constructive, fresh and significant decisions on such matters should be reported to the House of Commons. The right hon. Lady held a press conference on the matter. She has made a television appearance on this subject. We may wish to encourage the Government in their actions, but we must have the right to cross-examine on such matters. I plead with the right hon. Lady to respond to what I believe to be a feeling that can be found on all sides of the House. Will she make a proper statement?

The Prime Minister: No. Many of the bilateral discussions that we hold are both constructive and significant. They are a frequent occurrence as a result of our Community relationship. To make a statement on one particular meeting would elevate it in a way that is neither desirable nor warranted.

Mr. Foot: The right hon. Lady makes a great mistake when she deals with the House of Commons in such a way. Will she tell us the terms of reference that are to apply to the discussions on new institutions and on citizens' rights? Will she tell us how those possible citizenship rights accord or coincide with the nationality Bill which is to be brought before the House? There are a host of questions that the House of Commons has a right to ask.

The Prime Minister: These are matters that are to be explored. No decision has been made. [Interruption.] No decision has been made. Neither the right hon. Gentleman nor his predecessor required a statement on previous bilateral discussions between the United Kingdom and the Republic of Ireland. Doubtless the right hon. Gentleman and his colleagues will cross-examine my right hon. Friends as they wish.

Mr. Squire: Will my right hon. Friend comment on the hypocrisy of the protestations of the Leader of the Opposition? The right hon. Gentleman has not even considered—

Mr. Speaker: Order. Did the hon. Gentleman apply the word "hypocrisy" to an individual? [HON. MEMBERS: "Yes."] The hon. Gentleman will soon say so if he did.

Mr. Squire: I must have meant "inconsistency". I apologise.

Mr. Speaker: Does the hon. Gentleman withdraw the word "hypocrisy"?

Mr. Squire: Yes, Mr. Speaker. Will my right hon. Friend comment on the right hon. Gentleman's inconsistency, given that he has seen lit to withdraw from his Shadow Cabinet any speaker on Northern Ireland, defence and other important matters? Is not this an indication of the importance which the right hon. Gentleman attaches to Northern Ireland? Does not my right hon. Friend agree that that shows a very distorted sense of values?

The Prime Minister: The right hon. Gentleman has enough problems with his Shadow Cabinet without my becoming involved.

Mr. Molyneaux: As a result of yesterday's talks in Dublin, will the Prime Minister reaffirm that no concessions whatever will be made to the Maze prison hunger strikers? Secondly, if the joint discussions that were referred to in yesterday's communiqué take place, will the Prime Minister accept from the Ulster Unionist Party a list of subjects that might be appropriate for consideration?

The Prime Minister: As regards the latter part, the answer is "Yes, of course". No decisions have yet been made. Nor have any terms of reference been established or anything of that kind.
As regards the former question, I am glad to confirm that there were no concessions as regards the Maze hunger strike. My view is very well known. There can be no possible political status for those crimes, which include murder, carrying explosives and so on. The concessions on civilian clothing, which were made before the hunger strike began, were made to all prisoners in Northern Ireland. Last Thursday, we issued a comprehensive statement on the rights and privileges that are already available to conforming prisoners in Northern Ireland.

Mr. Meacher: asked the Prime Minister if she will list her official engagements for 9 December.

The Prime Minister: I refer the hon. Gentleman to the reply which I gave some time ago.

Mr. Meacher: Will the right hon. Lady acknowledge that she has pulled off a truly remarkable double? Given a 6 per cent. forecast fall in national output for this year and next year, we face the biggest slump since the 1930s, yet the money supply—on which altar the real economy has been sacrificed—is escalating out of control at twice the Government's target. If the right hon. Lady thinks that inflation is her one big success, what estimate will she give for the rate of inflation in 18 months' to two years' time, given that M3 is now escalating at 20 per cent. a year?

The Prime Minister: The hon. Gentleman has made an excellent case for a very much tighter money supply than that now operating. I accept that the money supply figures foreshadowed today are worrying. Perhaps the hon. Gentleman will accept that the main reason for those figures is the very high central Government borrowing requirement for this month. That is a factor that I have been trying to deal with, but I have had precious little support from Opposition Members.

Mr. Edward Gardner: May I congratulate my right hon. Friend on the constructive character of the bilateral talks that were held in Dublin yesterday? [Interruption.] In any future bilateral talks of that type, will she ensure that one subject of discussion will be the continuing right

of citizens of the Irish Republic—who are not citizens of this country—to vote in our general elections? Does not my right hon. Friend agree that a rational and agreed end to such an absurd anomaly would do much to improve future Anglo-Irish relations?

The Prime Minister: I am grateful to my hon. and learned Friend for those comments. We were trying to improve relations between the United Kingdom Government and that of the Republic of Ireland. As regards the right of citizens of the Republic of Ireland to vote in the United Kingdom, I understand from the Taoiseach that the Republic is prepared to consider giving rights to British subjects so that they can vote similarly in the Republic. That was announced long before yesterday's bilateral discussions. Naturally, we must first proceed with the nationality Bill, which will soon be placed before the House.

Mr. Foot: Does not the Prime Minister's answer illustrate the grievous wrong that has been done to the House? I speak as one who is strongly in favour of developing as good relations as we can between the London Government and the Dublin Government. Surely, the right hon. Lady must appreciate that many hon. Members in different parts of the House wish to ask questions relating to the nationality Bill and a whole series of matters. Is there not a danger that the right hon. Lady's discussions will have one interpretation put on them in Dublin and another here in London? Will not the Prime Minister provide a proper opportunity, as she is the only person who can answer on the matter for the whole Government, to make a statement to the House — perhaps tomorrow, at the beginning of next week, or certainly before the House rises for the recess—when we can cross-examine her properly?

The Prime Minister: No, Sir. If the right hon. Gentleman has a question to ask, he has had 15 minutes in which to ask it.

Mr. John Townend: As my right hon. Friend has made such an excellent start in abolishing quangos, will she try to find time today to turn her attention to wages councils, the activities of which are contrary to the Government's philosophy that wages should be settled on the basis of the individual employer's ability to pay? Will she bear in mind that the awards over the past two or three years have resulted in the loss of hundreds of thousands of jobs of low-ability workers and young people?

The Prime Minister: I understand what my hon. Friend is saying, but if there were any question of doing what he suggests we should have to consider very carefully what would be put in the place of wages councils. I believe that we should pursue that first through my right hon. Friend the Secretary of State for Employment.

Mr. Speaker: Statement—Mr. Patrick Jenkin.

Questions to Ministers

Mr. David Winnick: On a point of order—

Mr. Michael English: On a point of order—

Mr. Bob Cryer: On a point of order—

Mr. Harry Ewing: On a point of order—

Mr. Martin Flannery: On a point of order—

Mr. Speaker: Order. I normally take points of order after statements. We are to have a statement. I have notice of an application under Standing Order No. 9 as well, I think from the hon. Member for Mid-Ulster (Mr. Dunlop).

Mr. English: My point of order, Mr. Speaker, relates to Prime Minister's questions—

Mr. Speaker: Order. We cannot pursue the matter of questions now, but—

Mr. English: rose—

Mr. Speaker: Order. If there is a genuine point of order I shall hear it, but the normal courtesies of the House are to wait until we have a Minister's statement.

Mr. English: I am grateful to you, Mr. Speaker. I am sure that you will be aware that at one time points of order were often raised during Question Time. During the time of your predecessor it was suggested that it would be courteous to hon. Members who wished to ask questions if points of order were delayed until the end of Question Time. They are now to be delayed until the end of statements, which can be a very long time. I wish to ask something relevant to an answer given by the Prime Minister. I do not wish her to remain for perhaps half an hour.

Mr. Speaker: The hon. Gentleman and the House know that I cannot rule on points of order about replies by Ministers Ministers are responsible for the contents of their own replies.

Several Hon. Members: Several Hon. Members rose—

Mr. English.: I am sure, Mr. Speaker—

Mr. Speaker: Order. We cannot have a standing discussion with each other—at least, not here.

Mr. Cryer: I have a point of order, Mi. Speaker, relating to Standing Order No. 8. I have raised this point before, when you suggested that the Standing Order related only to private notice questions. However, it gives you power to allow questions at the end of Question Time, after 3.30 pin.
If the Opposition make representations about the Prime Minister's making a statement about an important and, in her terms, historic meeting, and she refuses, will you, Mr. Speaker, in those circumstances, when she is abrogating her responsibility to the House, be prepared to use your powers under Standing Order No. 8 to allow my tight hon. Friends the Leader of the Opposition and the appropriate Shadow spokesman to ask questions?

Mr. Speaker: I have already heard the Leader of the Opposition asking questions on that very subject. I shall

not use that Standing Order in a way that none of my predecessors ever did. I do not propose to put a new interpretation on the rule.

Scottish Grand Committee

Mr. Harry Ewing: On a point of order, Mr. Speaker—

Mr. Speaker: I shall take this one last point of order, and then we shall have a statement.

Mr. Ewing: This is on a different matter, Mr. Speaker. I hope that the whole House will regard it as very important. It is based on the belief that the House is responsible for its Committees once they have completed their work.
This morning the Secretary of State for Scotland and all his Ministers refused to vote for their own policy document in the Scottish Grand Committee. As a result, great uncertainty has been caused about the standing of that document and whether the Government have now re versed their policy in relation to their proposals to close the colleges of education.
Can you help the House, Mr. Speaker, in the serious situation that has arisen because the Secretary of State refused to vote in favour of his own policy document?

Mr. Speaker: As the House knows, I never rule on what happens in a Standing Committee. Statement, Mr. Jenkin.

Mr. Michael English: Order. The Prime Minister is leaving.

Social Security Benefits (Payment)

The Secretary of State for Social Services (Mr. Patrick Jenkin: With permission, Mr. Speaker, I should like to make a statement on the arrangements for paying social security benefits.
The House will recall that last February we debated arrangements for paying social security benefits and the implications for the sub-post office network. Widespread anxieties had been aroused in the country by misleading reports of what were thought to be the Government's intentions arising from a study of payment arrangements carried out last year in consultation with Sir Derek Rayner. Since then the Social Services Committee has studied the matter and issued its own report. The Government are publishing today their reply to the Select Committee, as Cmnd. 8106. Copies are available in the Vote Office. Because we want to consult widely on the changes that we now propose, this reply is in the form of a consultative document. It includes, as I promised last February, the full report of the original study by officials.
The consultative document makes it clear that we stand firmly by my right hon. Friend the Prime Minister's pledge of 28 February that retirement pensioners will continue to have their pensions paid weekly at post offices if they wish. We also repeat our commitment to safeguard the sub-post office network. The Government consider that these commitments can be fully honoured without sacrificing our wish both to give the public more choice and to save taxpayers' money by increasing efficiency.
Three main changes in the system of payment are proposed. The first change is that those who so wish may have their pensions or child benefit paid direct to a bank


account by automated credit transfer. Such payments would be four-weekly, in arrears. There would be no compulsion.
Secondly, my Department will make a number of internal changes, which will produce useful administrative savings and which the Select Committee recommended should proceed.
Thirdly, we propose that child benefit should be paid four-weekly for most mothers. People in receipt of suplementary benefit, family income supplement, the additional benefit for one-parent families and widows, pensions, together with mothers with four or more children, would be able to continue with weekly payment. This is a much larger group for weekly payment than the team of officials suggested, and it takes account of our concern to protect vulnerable groups.
In the light of the anxieties expressed by the House, the Government have paid particular attention to the effect of these changes on Post Office finances and on sub-post offices. If these proposals were implemented, clearly there would be a reduction in DHSS business in post offices. By about 1987–88 my Department would hope to reduce its administrative costs by about £38 million a year, at today's prices. About £25 million of these savings would come from reduced charges paid to the Post Office. In these circumstances the Government have thought it right to use the opportunity presented by the British Telecommunications Bill to allow the Post Office to conduct across its counters a wider range of business for the public sector.
After discussing this with the Post Office the Government are satisfied that if this Bill is approved there will be considerable scope for new counter business. The Government estimate that, allowing for some expansion of current business, sales volume across the counter should increase by about 8 per cent. in the next five years compared with about 6 per cent. of business likely to be lost as a result of the DHSS changes under the Government's proposals. The Post Office accepts these estimates.
These proposals will save taxpayers' money and provide more modern methods of paying benefits without damage to the sub-post office network. However, we are anxious that there should be full opportunity for public discussion of these proposals. We shall therefore be discussing them with all the main interests, including the National Federation of Sub-Postmasters, over the next three months before taking final decisions.

Mr. Norman Buchan: The Secretary of State purports to say in the statement that his main concern is to allay fears about misleading reports relating to sub-post offices, but we have, sadly, grown accustomed to reading between the lines of frequent ministerial statements. Does not this proposal conceal a number of other extremely serious matters?
Let us look at the question of the post offices, for a start. If the right hon. Gentleman is transferring extra work to the sub-post offices, I take it that, as he has no other means within his power, this is a transfer of jobs from the public sector to the post offices. Has the right hon. Gentleman consulted the other sections of public industry—for example, the gas and electricity boards? Is it not the case that where jobs are to be transferred to the post

offices there will be a job loss in the public sector, but that the profits will be made within the banks, to which so much of the work will be transferred?
The right hon. Gentleman reiterated the Prime Minister's pledge that retirement pensioners will continue to have their pensions paid weekly at post offices, but we have to look closely at the Prime Minister's pledges, do we not? Was she not on the verge of breaking one firm pledge in relation to the link between pensions and prices, only to be saved by the wets in the Cabinet? If the pension is to continue to be paid weekly to pensioners, will it be a question of opting in or opting out? Will difficulties be laid at the door of the old-age pensioner to get this secured?
There is a contradiction in the statement on child benefits. The right hon. Gentleman said that there would be no compulsion, but there will be compulsion. He also said that most families will be put on a four-weekly payment, with a series of exceptions. By definition, that means that most families will be four weeks' payments in arrears. How much will be saved by that four weeks in arrears for most families? Is it the £50 million that we have read about in the leaks? What will happen to that £50 million? Will it be used for the child benefit allowances, or is it yet another simple cut at the expense of children?
Will the right hon. Gentleman also confirm the figure that he gave earlier this month? In 1978–79 35 per cent. of child benefits were drawn weekly. I understand that that figure has risen to 45 per cent. in a single year. Will the right hon. Gentleman confirm that figure, which he gave in an answer only a few weeks ago? If so, is it not a sign of increasing pressure on all families, and not only those in the category mentioned in the document?
Does the Secretary of State not understand that one of the crucial points of the child benefit allowance is that it is paid to women? If he is putting most families on a four-weekly payment basis, will that not create a number of problems for women who have to budget weekly, because this part of the budget is being attacked by these proposals?
Last night the Chief Secretary to the Treasury referred to the Opposition breaking the consensus on the Welfare State. Is not a quiet counter-revolution taking place under the Government, in that administrative measures and statements of this kind are attacking and eroding the whole basis of the Welfare State? We are pledged to expose, halt and reverse that process.

Mr. Jenkin: I congratulate the hon. Gentleman on his first appearance at the Opposition Dispatch Box in his new job. I shall answer his questions.
Of course, there will be a need to consult other public sector organisations on the additional business that will go to the post offices. That is why we are publishing the reply as a consultative document.
The hon. Gentleman asked whether pensioners would have to opt for weekly payments. No, Sir. There is no way in which my Department can pay pensions or any other benefits into bank accounts without the beneficiaries telling the Department where their bank accounts are and giving the reference numbers. Therefore, they will be opting for automated credit transfers. If they do not opt for ACT, they will continue to be paid weekly.
The effect of paying the child benefit four weeks in arrears will be a saving of £50 million in the year in which it comes in, which we hope will be towards the end of next


year. But that is merely moving it forward into the following year. No long-term saving will be achieved. I confirm that the latest figure shows that 45 per cent. of mothers cash their child benefit weekly. We estimate that, with the exceptions, about 20 per cent. of families would still be entitled to the weekly payment.
The real point made by the hon. Gentleman was that mothers would be incapable of managing their affairs with the child benefit paid monthly. Is he aware that Belgium, France, Ireland, Italy, Luxembourg and West Germany pay child benefit four-weekly and that Denmark and the Netherlands pay their child benefit quarterly? Is the hon. Gentleman saying that mothers in England or Scotland are incapable of managing their affairs as well as are mothers in other countries? If he takes that view, I do not agree with him.

Mr. Buchan: I am not the only one who takes that view. Almost every group in this area recognises the immense value of a weekly payment going to the mother, so that she may have flexibility in her budgeting because of the problem; that arise elsewhere. For example, does the right hon. Gentleman realise that local authorities that collect rents on a fortnightly or monthly basis have arrears problems?
Is the right hon. Gentleman now admitting, although he did not say so, that, despite the fact that he said that this will not be compulsory, for the bulk of families it will be compulsory?
Finally, does the right hon. Gentleman realise that, Common Market or not, we are concerned with the Welfare State as it has been constructed in this country? The examples of Belgium and France are as nothing compared with the experience that we have had during the past 12 months under this Administration.

Mr. Jenkin: The hon. Gentleman is extraordinarily unconvincing on this subject. I made it abundantly clear that no one will be obliged to take payment into a bank or building society account. With the exception of Chat substantial group of families for which child benefit could be said to be a significant part of the family income, amities will be expected to operate on having the benefit paid four-weekly. This is the pattern in virtually every other West European country and I cannot believe that it is impossible or wrong for this country. This arrangement is overdue. We should have done it some time ago.

Mr. Paul Dean: I welcome the assurances in my right hon. Friend's statement. Will he beware of tidy solutions that administrators like but human nature abhors? Will he hold firmly to the principle of freedom of choice wherever possible, so that the large numbers of people who wish to have benefit, including child benefit, paid into bank accounts monthly will be able to do so and that those who budget weekly and wish to have weekly cash payments will be able to continue that arrangement?

Mr. Jenkin: That is the case for pensioners. I give my hon. Friend that firm assurance. I must make it clear that the Government are proposing consultation on the basis that for the generality of families, apart from the especially vulnerable groups that I have mentioned, child benefit will be paid four-weekly. I believe that that is a right proposal.

Mr. John Golding: Is the Secretary of State aware that moving from weekly to

monthly payments will cause great hardship? Is he further aware that families operating on monthly salary budgets will not experience the same degree of hardship as families that budget weekly and find it difficult to save money from one week to the next? That is particularly so because of short-time working and the growing difficulty that working people have in managing on their pay.

Mr. Jenkin: The change will not happen overnight. We anticipate that we may be able to begin moving families on to four-weekly payments towards the end of next year, or early in 1982. Families will have between 12 and 15 months' notice of the change. The change will be progressive, as the order books are renewed. I am not talking of families on family income supplement or one-parent families, who will continue to receive benefit weekly. They are exceptions, which do not apply in other European countries, although we believe that they should be exceptions here. It is reasonable to ask the generality of families to make arrangements to tide them over during the changeover period.

Mr. John Wells: What type of other public business might be introduced to the small village post offices to sustain them? I cannot see readily how a village with 400 residents can sustain a post office on the basis of selling railway tickets, for instance, because not many such people travel by train. Perhaps my right hon. Friend will consider abolishing the Tote and allowing postmasters to do its business. May we have a serious suggestion about how the small post offices will survive, since no other public business exists for them?

Mr. Jenkin: I understand my hon. Friend's anxiety. With my right hon. Friend the Secretary of State for Industry I have already had preliminary discussions with the sub-postmasters' representatives. My right hon. Friend has the primary responsibility and wishes to discuss with the Post Office a range of matters that might be open to the sub-postmasters. Obvious examples are the railways and transport generally. The energy industries are also possibilities. Sub-post offices might take over the payment of energy bills and the selling of energy stamps. That would depend to some extent on the success of the Post Office in opening up the new spheres available to it. We understand and accept the need for extra business to make up for the loss of the DHSS business so that we can fulfil our pledge to keep the sub-post office network in being.

Mr. David Penhaligon: May we have a simple assurance that the business and income of the sub-postmaster in the rural village will not decrease as a result of the proposals?

Mr. Jenkin: I do not think that I can give the pledge precisely in that form. I wish to be honest with the House. The Post Office has accepted the Government's estimate that overall, and over a period of about four or five years, the amount of extra business available will more than compensate for the loss of the DHSS business.

Mr. R. A. McCrindle: Am I right in thinking that the Government proposal for the payment of child benefit and family income supplement is that they will be paid on a monthly basis unless the recipient opts to the contrary? If I am correct in that assumption, will my right hon. Friend give me some reassurance that maximum publicity will be given, for the benefit of people who wish to continue to be paid weekly?

Mr. Jenkin: I accept that publicity is important. People who will be entitled to weekly payments for the family income supplement and other payments will have that made clear to them. It will be made clear that they have a choice. We shall take the necessary steps to ensure that they know about that right, so that they can exercise it freely.

Mr. David Steel: Does the Secretary of State understand that many people in the Post Office are just as keen on centralisation as are people in Government Departments? Is he aware that vague assurances about the overall level of Post Office income does not satisfy? What assurances can the Secretary of State give about the future of local village sub-post offices?

Mr. Jenkin: I expect that the Federation of Sub-Postmasters, now that it knows the Government's proposals, will make an early approach to the Post Office about the contract that the federation has with the Post Office on the division of business of the type that we are discussing.
The Post Office has made it clear that it regards the maintenance of the sub-post office network as being of great importance to it, as it is to the Government. We are providing time for consultation. We have not finally made up our minds. We shall study the outcome of the consultations. I made it clear in February, and I make it clear now, that we attach the highest importance to the maintenance of the sub-post office network in the villages and the rural areas as much as everywhere else.

Mr. A. W. Stallard: May I take the Secretary of State back to the reply that he gave to my hon. Friend the Member for Renfrewshire, West (Mr. Buchan), when he referred to practices in other European countries? May we assume that the Secretary of State will soon propose parity with all other EEC countries on pensions, heating allowances, television licences, death grants, and so on? Are we to have parity with other European countries? Is the right hon. Gentleman aware that there are great disparities between benefits paid here and benefits paid in the rest of Europe? Who is to judge which families are to be paid four-weekly? Will the housewife have the right of appeal?

Mr. Jenkin: I shall not be drawn into discussing the amounts of benefits. That is a separate issue. The point is that almost every other European country has for some years managed happily, as have European families, with monthly payments of child benefit.

Mr. Stallard: Mr. Stallard But they receive more money.

Mr. Jenkin: The higher the amount of benefit the more the family depends upon it, and the more it might be needed weekly. People in other countries have managed well being paid monthly. I am sure that we can, too. I did not understand the hon. Gentleman's second question.

Mr. Peter Bottomley: I welcome my right hon. Friend's desire to keep the sub-post offices going in order to extend choice and to achieve greater efficiency. Am I right in believing that we are discussing a consultation document? Will it be possible for people in favour of extending choice for families to suggest to the Government that the four-weekly payment should be paid two weeks into the month? Will people be able to suggest

that the payment should be made fortnightly in order to provide a transition for a year or two, so that an adjustment can be made to monthly budgeting?

Mr. Jenkin: I understand my hon. Friend's anxiety and I am grateful for his general welcome. However, in a year when public expenditure will be under extreme constraint the Government would require a great deal of persuasion to forgo the saving in one year occasioned by the transfer to monthly payments of child benefit. To offer the incentive to people to transfer to four-weekly payments of pensions by automated credit transfer would also involve a cost. I must advise the House that the Government are not prepared to recommend that cost.

Dr. Oonagh Mcdonald: Is the Secretary of State aware that many families who are in receipt of a weekly wage, in addition to the exceptions that he has mentioned, will suffer greatly by the transfer of child benefit to monthly payments? Is he aware that mothers use the child benefit to tide them over from Tuesday to Thursday or Friday, when the weekly wage comes in, and that the money is used to buy food and other essentials? Is he further aware that his comparison with other EEC countries would carry more weight if he were prepared to pay the level of child benefit paid in the other EEC countries, because in all such countries except Ireland the payments are well above those paid in Britain? Will he also tell the House what special arrangements he intends to make to consult the women concerned about this alteration and, in particular, the women's organisations that represent many of them?

Mr. Jenkin: The consultation will be open to anyone who wishes to participate, including women's organisations and organisations representing poor families and one-parent families, such as the Child Poverty Action Group, the National Council for One-Parent Families, and other groups of that sort. I understand the hon. Lady's point about the budgeting customs of many families, but I cannot accept it as a reason for retaining weekly payment for all families for all time. That argument applies equally to countries such as Ireland, which pay small levels of family benefit. They have managed quite satisfactorily. I cannot accept that mothers in this country are less able than people in other countries to manage their affairs on a sensible basis and to accept a change of this kind. That seems a rather demeaning view to take of mothers in this country.

Mr. Speaker: Order. I propose to call two more questions from either side before I call the Front Bench in conclusion.

Mr. Richard Alexander: Whilst accepting my right hon. Friend's objectives entirely, may I nevertheless underline the concern that will be felt by many postmasters and sub-postmasters, not least in my constituency, and urge him to indicate at an early date the much wider range of business that they will receive by way of compensation as a result of the announcement?

Mr. Jenkin: The question of the wider range of business that the Post Office and sub-postmasters will be able to conduct is primarily a matter for my right hon. Friend the Secretary of State for Industry. Provision to enable this to be done is contained in the British Telecommunications Bill, which is currently before the House. That will be the forum for the House to explore


what may be done. It will be for my right hon. Friend to conduct negotiations and discussions both with the Post Office and with the sub-postmasters to explore the many suggestions that have been put forward.

Mr. Andrew F. Bennett: Does the right hon. Gentleman agree that the major advantage of child benefit is that it is a universal benefit, which is paid to everyone? How can he justify creating first-and second-class claimants in this measure? Is he also aware of the major problem of people with a reasonable income who are suddenly plunged into poverty, perhaps by the husband leaving the family, and that at present child benefit is available immediately to cushion such people while they find other benefits? Will he guarantee that people will be able to move from monthly to weekly payment at a moment's notice if family circumstances change?

Mr. Jenkin: I can give the hon. Gentleman the undertaking that if there are sudden changes in family circumstances my Department responds, and frequently responds very quickly, to meet immediate needs of that sort. This would certainly include arrangements to tide families over in the kind circumstances that the hon. Gentleman has in mind.

Sir Albert Costain: Has the Minister made any calculation as to the loss of income that will be incurred by village post offices affected by these changes? Can he say whether any are likely to close as a result, with the loss of essential services?

Mr. Jenkin: My hon. Friend will recollect that we estimate that the loss of income over the period of four or five years is likely to be about 6 per cent., which would be perhaps about £25 million at today's prices. The estimate that we have made and that the Post Office has accepted is that the additional business from other users by 1987–88 would be about 8 per cent., or between £30 million and £35 million. So, on balance, we would expect the Post Office and sub-post office network marginally to gain front our proposals.

Mr. James A. Dunn: Is the Minister aware that his statement will cause concern among low-income groups, particularly those who are not in receipt of supplementary benefit and may have fewer than four children, such as widows, one-parent families and other similar groups? On what criteria is, monthly payment to be made in those circumstances, if the classification can be sustained that they are low-income groups?

Mr. Jenkin: It must be remembered that one of the categories entitled to continued weekly payment is that of families on family income supplement. When I tell the hon. Gentleman that that would include a one-child family with an income of £67 per week, a two-child family with an income of £74 a week, and a three-child family with an income of £81 per week, I think that he will recognise that that moves quite well up the income scale before people will be obliged to transfer to four-weekly payment.

Mr. J. W. Rooker: Can the right hon. Gentleman clear up one point arising from an answer that he gave earlier? Will he confirm that during the year when the changeover takes place, when 80 per cent. of mothers are deprived of child benefit for four weeks, the Government will spend £50 million less on child benefit than they would otherwise have spent? Will

he further confirm that that £50 million will simply be lost out of public expenditure on child benefit that year and will not be transferred to the next year? If it is transferred to the next year will it be in the form of an increase in child benefit?

Mr. Jenkin: The hon. Gentleman will recognise that when one postpones the date of payment one moves forward the Government's obligation to pay, and some of that will move into the next financial year. But over the years of a family's entitlement to child benefit for a particular child, the amount of money paid will be exactly the same.

Liverpool (Demonstration)

Mr. Speaker: Does the hon. Member for Liverpool, Scotland Exchange (Mr. Parry) wish to pursue his point of order, which I must warn him in advance will be very thin?

Mr. Robert Parry: Yes, Mr. Speaker. My point of order relates to the statement that appeared in the Liverpool press during the weekend, when the Secretary of State for Education and Science was stated to have accused my right hon. Friend the Leader of the Opposition of whipping up a mob in Liverpool at the demonstration by the unemployed on 29 November. That statement was recorded in the Liverpool Echo as:
Foot whips up the mob
We on Merseyside, and particularly the unemployed, are opposed to that statement—

Mr. Speaker: Order. I am sure that the hon. Gentleman is opposed to that statement, but I want a point of order on which I can rule. Political arguments between the two sides take place in the country as well as in the House, but if there is a point of order on which I can rule, I am willing to try.

Mr. Parry: I believe that the speech was made in my constituency, at the Merseyside Conservative ladies' luncheon club, which does not seem to be a deprived organisation. The right hon. and learned Gentleman did not have the courtesy to advise me, although he was speaking in my constituency. We on Merseyside are sick and tired of laughter and jokes from Conservative Members when we are talking about unemployment on Merseyside. Many of the unemployed on Merseyside feel that the real mobsters are hon. Members on the Government side of the House.

The Chancellor of the Duchy of Lancaster, Leader of the House of Commons and Minister for the Arts (Mr. Norman St. John-Stevas): Further to that point of order, Mr. Speaker. My right hon. and learned Friend the Secretary of State for Education and Science was here earlier, but unfortunately he could not remain. The hon. Gentleman is quite right. It is a normal courtesy for Ministers to inform hon. Members if they are speaking in hon. Members' constituencies. Those courtesies have a point, and should be observed.
My right hon. and learned Friend intended to observe that courtesy, but I am told—I do not know whether this makes things better or worse—that he wrote to the wrong hon. Member. He tells me that he wrote to the hon.


Member for Liverpool, Edge Hill (Mr. Alton). There it is. I apologise to the hon. Member for Liverpool, Scotland Exchange (Mr. Parry).

Questions to Ministers

Mr. Jim Marshall: On a point of order, Mr. Speaker. I have given you notice of the point of order that I wish to raise. I appreciate the difficulties that you face in this area. You will recall that on yesterday's Order Paper I had tabled Question No. 9 to the Secretary of State for Energy. My question was linked with Question No. 24, in the name of my hon. and learned Friend the Member for Leicester, West (Mr. Janner). I certainly had no objection to my question being linked with that of my hon. and learned Friend. However, on today's Order Paper, my hon. Friend the Member for Harlow (Mr. Newens) had tabled Question No. 12, which was reached. That question is almost identical to my own question, No. 24. My question was not linked with that of my hon. Friend the Member for Harlow. While I appreciate the difficulties that you face, Mr. Speaker, I would be obliged if you could ensure that there is fairness between the treatment that different Government Departments give hon. Members. Perhaps you will look into this matter and ensure continuity and uniformity of practice in the linking of questions.

Mr. Speaker: The hon. Gentleman and the House will know that I do not have responsibility for the grouping of questions. I shall, of course, look into this matter, but a variety of attitudes are adopted because different Departments take different views.

Mr. David Winnick: On a point of order, Mr. Speaker. Perhaps I can raise with you a matter on which you ruled previously today. It relates to points of order arising from Question Time. As I understand the position, it is not your wish — and it is perfectly understandable—that points of order should arise during Question Time itself, because that would obviously shorten the time available for questions. However, perhaps you will give further cansideration to your wish that points of order that arise from Question Time should be taken only at the end of statements, private notice questions, and so on.
Perhaps I may give one illustration. Today there was a wish to raise points of order immediately after Prime Minister's Question Time, arising from the lack of a statement on Northern Ireland. Had those points of order been taken then, at least the Prime Minister would have been present. Is it your general wish that this should happen, Mr. Speaker? Will you give the matter further consideration? I believe that hon. Members should have the opportunity of raising points of order arising from Question Time.

Mr. Speaker: The hon. Gentleman has drawn my attention to an important point. I see a difference between what I call general points of order, such as the two about which I was given notice today, and those arising directly out of Question Time. I shall, of course, give further consideration to the matter and make a brief statement on it tomorrow.

Canada (Constitution)

Mr. Michael English: Mr. Michael English (Nottingham, West) rose—

Mr. Speaker: The hon. Member for Nottingham, West (Mr. English) felt that we should take points of order earlier, and at his request I did so. I would, therefore, be surprised if he still had the urge to raise a point of order.

Mr. English: Mr. English indicated dissent.

Mr. Speaker: Well, the Christmas season is near.

Mr. English: I am grateful to you, Mr. Speaker, I only wanted to ask whether you would supplement the splendid answer given by the Prime Minister earlier in reply to a question about Canada. I am sorry that in accordance with your ruling she has not seen fit to stay to hear my slightly unusual remark. As you will recollect, Mr. Speaker, she said that if, in accordance with precedent, the Canadian Parliament—this is where the matter is a point of order, as it relates to Parliament, and has nothing to do with Government—made a request to this Parliament, the matter would be dealt with as expeditiously as possible. I am sure that all hon. Members would agree with that. The problem is that the precedents are not available to us in the Library. They are far better set out in Canadian words than in British words. In fact, they were set out by M. Guy Favreau, the Minister of Justice of the Canadian Liberal Government of 1965, after consulting all 10 Attorneys-General of every province of Canada. They were set out in a White Paper that was produced on behalf of the Canadian Liberal Government at the time. Perhaps you will arrange for as many copies of that as possible to be available to us in the Library.

Mr. Speaker: I do not know about the latter, but I shall look into it. It would be unwise of me to add anything to the statement made by the Prime Minister. Obviously I am watching this matter as closely as anyone else, because it could well come before me at a later stage for a ruling.

Northern Ireland (Dublin Talks)

Rev. Ian Paisley: I beg to ask leave to move the Adjournment of the House, under Standing Order No. 9, for the purpose of discussing a specific and important matter that should have urgent consideration, namely,
the Dublin summit and its effect on Northern Ireland's position as an integral part of the United Kingdom.
Yesterday, the Prime Minister, together with three senior Cabinet colleagues, went to Dublin for an important meeting. After that meeting, it was announced that it was "historic, important and constructive". When my hon. Friend the Member for Belfast, East (Mr. Robinson) asked the Northern Ireland Office today for a copy of the communiqué which was issued, he was told that it was not available to Members of the House of Commons, and was referred to the Irish Times.
The Irish Times report certainly does not help my conception of this conference, because it states:
All Ireland plan may follow talks at Dublin Summit".
That does not help the situation in Northern Ireland. There is a sense of outrage and betrayal in Northern Ireland with regard to this matter. Surely this House should have been given the opportunity today of hearing what happened at that conference, because there is a conflict between what


the Prime Minister said at her press conference and what the Premier of the Irish Republic said at his. The communiqué refers to
a wide range of joint studies
which will be launched, and which will include
new institutional structures, citizenship rights, security matters, economic co-operation and measures to encourage mutual understanding".
On numerous occasions, the right hon. Lady and her colleagues have assured the people of Northern Ireland, through their elected representatives in the House, that new institutions for Northern Ireland are a matter solely for the Government and Parliament of the United Kingdom and the people of Northern Ireland. But it is now clear from this communiqué that the Republic will have a direct and increasing involvement in these matters. Surely the House should have an opportunity to discuss the issue.
The House should jog its memory and remember that if an attempt is made to coerce the majority of the people of Northern Ireland — who again and again have expressed their democratic wishes at elections set up by the House—it will again have to learn that it cannot do so. This matter should be fully ventilated in the House.
The only forum that we in Northern Ireland have is this House, even though the people of the Province are under-represented in it. I feel that the matter should come before the House. The Government have fallen down badly by making statements at press conferences while at the same time not giving the elected representatives of the people the opportunity to discuss this matter.

Mr. Speaker: The hon. Gentleman gave me notice before noon that he would seek leave to move the Adjournment of the House under Standing Order No. 9 for the purpose of discussing a specific and important matter that he thinks should have urgent consideration, namely,
the Dublin summit and its effect on Northern Ireland's position as an integral part of the United Kingdom.
The House knows, and I repeat it for the record, that I do not decide whether this matter shall be debated. All that I can decide is whether there shall be a three-hour emergency debate either tonight or tomorrow night. That is the limit of the powers that the House has given to me in this regard. The House has also instructed me to give no reasons for my decision when I make my ruling.
I have given careful consideration to what the hon. Gentleman has said, but I have to rule that his submission does not fall within the provisions of the Standing Order, and therefore I cannot submit his application to the House.

BILL PRESENTED

ATOMIC ENERGY (MISCELLANEOUS PROVISIONS)

Mr. Secretary Howell, supported by Secretary Sir Keith Joseph, Mr. Secretary Edwards, Mr. John Biffen, Mr. Hamish Gray, Mr. Norman Lamont and Mr. John Moore, presented a Bill to extend the power of the United Kingdom Atomic Energy Authority to dispose of shares held by them in any company and the power of the Secretary of State to dispose of shares held by him in companies engaged in activities in the field of atomic energy or radioactive substances; to extend the power of the Secretary of State with respect to the application of sums received by the Authority; and for connected purposes: And the same was read the First time; and ordered to be read a Second time tomorrow and to be printed [Bill 12].

STATUTORY INSTRUMENTS, &c.

Mr. Speaker: By leave of the House, I shall put together the Questions on the five motions relating to Statutory Instruments.

Ordered,
That the draft Hill Livestock (Compensatory Allowances) (Amendment) Regulations 1980 be referred to a Standing Committee on Statutory Instruments, &amp;c.
That the Sheep Variable Premium (Protection of Payments) (No. 2) Order 1980 (S.I., 1980, No. 1811) be referred to a Standing Committee on Statutory Instruments, &amp;c.
That the White Fish Authority (Research and Development Grants) Order 1980 be referred to a Standing Committee on Statutory Instruments, &amp;c.
That the Customs Duties (ECSC) (Quota and Other Reliefs) (Amendment No. 2) Order 1980 (S.I., 1980, No.1867) be referred to a Standing. Committee on Statutory Instruments, &amp;c.
That the draft Building Societies (Special Advances) Order 1980 be referred to a Standing Committee on Statutory Instruments, &amp;c.—[Mr. St. John-Stevas]

St. Lucia (Independence Gift)

The Chancellor of the Duchy of Lancaster, Leader of the House of Commons and Minister for the Arts (Mr. Norman St. John-Stevas): I beg to move,
That an humble Address be presented to Her Majesty, praying that Her Majesty will give directions that there be presented on behalf of this House a gift of a clock and gavel set to the Parliament of St. Lucia, and assuring Her Majesty that this House will make good the expenses attending the same.
It is one of the best of both our parliamentary and our Commonwealth traditions that this House offers a present suitable for use in a legislative assembly to the Parliaments of the Commonwealth countries to mark their independence. I am happy to be moving two motions today to give formal authorisation for such gifts. The first motion relates to the gift of a clock and gavel set for the Parliament of St. Lucia. this present was agreed after consultation with the then Speaker of the House of Assembly and is now ready for presentation. It will be on display to hon. Members in the Upper Waiting Hall from Monday to Wednesday next week.
If the House agrees to the motion, and to the following motion relating to a gift to Dominica, a further motion will be moved for leave of absence to be given to a small delegation from the House for the presentation of these two gifts.
I commend the motion as an expression of the friendship and good will of this House to the Parliament


of St. Lucia. I am sure that I speak for the whole House in expressing our warmest good wishes for the future of the Parliament and people of that beautiful island, which I had the good fortune to visit some time ago.

Mr. John Silkin: On behalf of this side of the House, I am happy to associate the Opposition with this motion. It is a very pleasant and agreeable tradition that such gifts should be made, and it is a symbol of the growing friendship of an independent nation with what was the mother country.
I think that hon. Members on both sides of the House would wish to express our sympathy with the island for the damage that was suffered during the recent hurricane. It was a sign of the friendship and kinship between the two countries that we were able to offer some assistance during that disturbance.

Question put and agreed to.

Dominica (Independence Gift)

The Chancellor of the Duchy of Lancaster, Leader of the House of Commons and Minister for the Arts (Mr. Norman St. John-Stevas): I beg to move,
That an humble Address be presented to Her Majesty, praying that Her Majesty will give directions that there be presented on behalf of this House a gift of a Speaker's Chair to the House of Assembly of Dominica, and assuring Her Majesty that this House will make good the expenses attending the same.
Perhaps I may preface my remarks by offering my sincere congratulations and good wishes to the right hon. Member for Deptford (Mr. Silkin) on his becoming Shadow Leader of the House. He is familiar with the procedures of the House as a most distinguished Opposition Chief Whip and, even rarer, as a reforming Chief Whip. That is a rara avis indeed. It is virtually—a contradiction in terms—as rare—we were told by the

Leader of the Opposition—as a Tory intellectual. I look forward to co-operating with the right hon. Gentleman in the interests of the House.
I am equally happy to move this motion to approve a gift of a Speaker's Chair from this House to the House of Assembly of Dominica. I again understand that this accords with the wishes of the Speaker of the Assembly. It is a dignified and traditional feature of a legislative chamber.
The Chair will be on display in the Upper Waiting Hall from Monday to Wednesday of next week.
I am sure that the House will join me in supporting the motion, which conveys our warm wishes for the happiness and prosperity of this equally lovely island and for the successful future of the House of Assembly of Dominica.

Mr. John Silkin: I thank the Leader of the House for his good wishes and for his tribute to me. I hope that both of us will recover from it in due course.
I am happy to associate the Opposition with this motion, too. In the case of Dominica, here again we are very happy to be fully associated with what is an excellent traditional symbol.

Question put and agreed to.

Resolved,
That an humble Address be presented to Her Majesty, praying that Her Majesty will give directions that there be presented on behalf of this House a gift of a clock and gavel set to the Parliament of St. Lucia, and assuring Her Majesty that this House will make good the expenses attending the same.
Address to be presented by Privy Councillors or Members of Her Majesty's Household.

Resolved,
That an humble Address be presented to Her Majesty, praying that Her Majesty will give directions that there be presented on behalf of this House a gift of a Speaker's Chair to the House of Assembly of Dominica, and assuring Her Majesty that this House will make good the expenses attending the same.
Address to be presented by Privy Councillors or Members of Her Majesty's Household.

Orders of the Day — Local Government (Miscellaneous Provisions) (Scotland) Bill

Order for Second Reading read.

The Secretary of State for Scotland (Mr. George Younger): I beg to move, That the Bill be now read a Second time.
Since the present structure of local government in Scotland was set up by the Local Government (Scotland) Act 1973, the House has considered two further Local Government (Scotland) Bills, as well as a number of other Bills affecting local authorities in one way or another. It is clear enough from the title of the Bill that its basic purpose is to make adjustments to the present system, not to disturb its structure, which is, in our view, basically sound. It was certainly in accordance with this view that shortly after we took office last year we set up a committee, the Stodart committee, to look at the working relationships between local authorities and to consider whether any changes were necessary in the distribution of functions between the tiers. The committee has now completed its task and, as I have announced, its report is to be presented to Parliament by, I hope, the end of January next year.
The provisions in the present Bill have no obvious single theme but, looked at overall, they disclose a pattern which is illustrative of our wish to cultivate a strong and healthy local democracy which at the same time recognises its national responsibilities and acts accordingly.
This means two things. If local government is to be genuinely democratic, authorities must be free to carry out the local functions which they have been given by Parliament without unnecessary interference from the Government. But the other side of the coin is that authorities must keep in mind their responsibility not just to their own electors but to the country as a whole and must ensure that their decisions should reflect national as well as local interests. It must be the responsibility of the Government to see that some local interests are riot pursued regardless of other local interests and of the national welfare.
The Bill is, therefore, intended not only to achieve a lessening of the Government's controls over local authorities when the national interest is not concerned, and where there is a legitimate national interest in the conduct a local government—namely, in expenditure matters—to extend my powers of intervention. I now turn, therefore, to the provisions of part II in relation to rate support grants. Before offering detailed comment on the clauses in this part, I should like to give the House a brief explanation of the background and the reasons for their introduction.
At least until Opposition Members left office last year, it was common ground that the Government had a legitimate and, indeed, vital interest in the scale of local authority current expenditure. The reason is self-evident. Expenditure in this category forms a substantial part of total public expenditure—in Scotland, incidentally, it is 40 per cent. of expenditure within the Secretary of State's responsibilities—and it would not be possible to pursue

sensible fiscal policies if this element were omitted from consideration and influence by the Government of the day. For an example of this, I turn no further than to the right hon. Member for Glasgow, Craigton (Mr. Milian), who is on public record many times during his period of office urging authorities to constrain their expenditure in the national economic interest. Perhaps his most notable contribution was during the debate on the Rate Support Grant (Scotland) Order 1976, when he drew attention to the need for any increases in individual programmes to be offset by reductions in others, to the need to control staff numbers, to the very high rate of growth shown by local authority expenditure relative both to gross domestic product and to total public expenditure, and to earlier statements by his Administration that growth in local authority expenditure should not continue.
The House will also be aware that majority opinion among local authorities has for many years recognised the principle that they must have regard to the national economic interest, and generally authorities have in the past kept their total expenditure plans reasonably in line with the fiscal policy followed by the Government of the day.
The right hon. Member for Craigton will remember that he has good cause to be grateful to many Conservative authorities as well as Labour ones who supported him over the cuts that he was forced to make after the IMF walked in to bail out the last Government. That remains true of 1980–81 in that authorities responsible for the greater part of expenditure are now showing a moderate and sensible approach to expenditure levels.
Some authorities have conspicuously failed to do so, however, and have made it clear that they will seek continual increases in expenditure levels notwithstanding the Government's urgent advice that moderation is essential, in sharp contrast to the constructive and sensible approach of their other colleagues of all parties in local government. I must tell the House and the authorities concerned that the Government simply cannot condone irresponsibility of this kind. We have a responsibility to the entire community to ensure that public expenditure as a whole is managed with proper regard for economic realities. If we fail in this, we shall impose harsh economic and social penalties on the community at large, as the Labour Government succeeded in doing by allowing public expenditure to soar out of control throughout their last period in office — a time when restraint: and moderation were clearly called for.
When I reviewed the need for means of taking action against the irresponsible minority, it was, of course, tempting to undertake a major revision of the present grant system. But I am anxious to maintain a constructive partnership with local authorities, and during extensive consultations with the Convention of Scottish Local Authorities I was informed that the present system—which seeks to compensate for variations in local needs and resources — is working reasonably well and is broadly acceptable to local authority opinion. I weighed this advice with great care. Having done so, I have concluded that the best course is to graft on to the existing system provision for discouraging high levels of expenditure by selective grant reductions.
I intend, therefore, that at the outset of each financial year each authority will be offered, through the traditional rate support grant settlement, a level of support closely geared to its local circumstances, and it will receive that


support in full measure if it avoids planning for excessive and unreasonable expenditure levels. But grant reductions will be made, subject to approval by the House of Commons, if, when striking its rate, an authority proposes excessive and unreasonable levels out of line with the expenditure assumptions made by the Government in making the grant settlement. This power extends an existing provision of considerable antiquity under which the Secretary of State may reduce grant after expenditure has been incurred. That power, although potentially useful, is not fully effective for my present purposes because of the time lag between the expenditure and the grant reduction.
These proposals do not imply unwarranted interference with local authority autonomy or discussion. Hon. Members will note that authorities will remain free, as at present, to determine their priorities with a fair and substantial measure of support from the Government. For the future, however, assuming enactment of these provisions, the Government reserve the right to modify the level of support which they offer to any individual authority which plans for an excessive and unreasonable expenditure level. We cannot afford to subsidise economic irresponsibility.

Mr. Robin F. Cook: The Secretary of State referred to the powers as being of "considerable antiquity". I think that he was referring to the powers of the 1966 Act and the legislation that preceded it. Those powers have never been invoked because never has an appropriate case arisen in which the Secretary of State — the right hon. Gentleman or his predecessors — felt that a local authority had so exceeded the expenditure as to afford a proper cause for the use of those powers. Since such a case has not arisen in 15 years, why is it now necessary for him to seek far more sweeping powers which will enable him to meddle at a much earlier stage in a local authority's financial year?

Mr. Younger: I am not sure whether that is good news. I do not know whether the hon. Gentleman speaks for the Lothian region. If he is saying that he hopes, as I do, that such powers not only have not been used but will never need to be used, no one will be more glad to hear that than I. They have not been used precisely because up to now no local authority has been unwise enough to incur the penalty which previous Governments put on the statute book. In case the hon. Gentleman is getting too excited, may I say that these powers have been repeatedly enacted and re-enacted by successive Labour Administrations, so that there is nothing particularly partisan about them.
The hon. Gentleman will also no doubt note that there will be no need for the powers to be exercised if all authorities show reasonable sense and moderation. If confrontation occurs, it will be by the deliberate choice of the authorities concerned.
Implicit in what I have said is that none of the penalty will apply to any authority other than one that has incurred unreasonable or excessive expenditure. Authorities that have not incurred such expenditure will suffer no penalty. It is a truly selective penalty which is extremely fair, and it is a great safeguard for everyone.

Mr. Gavin Strang: The right hon. Gentleman keeps referring to "reasonable expenditure". It

is significant that it was he who first referred to the Lothian region. Will he give us an assurance that he will not regard, for example, the subsidisation of bus fares, which many people, irrespective of their political view, consider to have great merit, as being unreasonable? Surely he will not intervene in local government decisions in that way.

Mr. Younger: I am glad that the hon. Gentleman made that intervention, because it enables me to clarify a point that he may have misunderstood. I have no intention, nor am I taking any power, to look into the particular expenditure of any particular authority on any given revenue item such as bus fares. I am seeking only to take a look at the general planned expenditure of a local authority, and if in aggregate it appears to be unreasonable and excessive I shall have the power to take the action I am seeking in the Bill. It is not a question of my interfering in internal expenditure matters. They will remain matters for local authorities to determine within a reasonable overall level of expenditure.

Mr. Donald Dewar: The Secretary of State tells us that his proposals will allow intervention at the estimate rather than the outturn stage. He has also agreed that under the powers of the 1966 Act there has never been an intervention by the Secretary of State. Looking back over the past few years, can he say whether there has been a year when, at estimate stage, it would have been reasonable for him to use the new powers?

Mr. Younger: I have not studied that matter, but I give the hon. Gentleman the same answer as I gave just now. This is a new phenomenon, because under successive Administrations, Labour as well as Conservative, it has been generally agreed that local authorities work sensibly within prevailing national economic policy. This has not hitherto been a partisan matter, because Conservative-controlled local authorities were particularly helpful to the right hon. Member for Craigton when he was in difficulty on the matter. I think that he was good enough to acknowledge that on one or two occasions.
I hope that this issue will not become one of partisanship, because this is a matter of principle as to whether the local authority set-up works within the bounds of national economic policy. Fortunately, the vast majority of local authorities do, and the vast majority today — authorities of all political persuasions — are working within general national economic priorities. That is how it should be. That is how I hope it will remain. That is why I hope that not only the old powers but the new powers will be used, if ever, very seldom.
Section 5 of the Local Government (Scotland) Act 1966, which is mentioned in clause 13, empowers the Secretary of State, subject to the approval of the House, to reduce grant to an authority if he is satisfied that the authority has incurred an excessive and unreasonable level of expenditure. Clause 13 extends that power by enabling the Secretary of State, subject to the same conditions, to reduce grant if he is satisfied that an authority, when striking its rate, has planned for an excessive and unreasonable level of expenditure. It also introduces certain additional criteria that will enable the Secretary of State to take into account all relevant considerations when considering whether he is satisfied that a particular level of expenditure is excessive and unreasonable.
Clause 14 amends the 1966 Act and makes provision for the Secretary of State to substitute a lower rate poundage for actual rate poundage in determining the entitlement to grant under the resources element of an authority, which plans for an excessive and unreasonabe level of expenditure. That will enable the Secretary of State to prevent such an authority from profiting by increased grant under the resources element from a high rate level resulting from unduly high levels of planned expenditure. It offers an alternative or supplementary procedure to that for which provision is made by clause 13. C1ause 15 makes provision for those powers to be effective from the financial year 1981–82.
Clause 16 makes provision for use by the Secretary of State of estimates of expenditure for purposes of the earlier clauses if an authority fails to provide the required information timeously. It is essentially a contingency provision. Clearly, it would be preferable in all cases to operate on information provided by the authority, but on the other hand it would be foolhardy to create a position in which these important policies could be frustrated by deliberate withholding of information.
It may also be for the convenience of the House if at this stage I mention a related provision in schedule 3. Paragraph 8 proposes a further amendment to section 5 of the 1966 Act, the general effect of which is to provide the secretary of State with wide discretion to restore to the original recipient all or part of a reduction in grant made under the provisions of clause 13 if its subsequent conduct justifies that, or to distribute up to the amount of the reduction to other authorities if restitution is not made.
I hope that my general comments on this part of the Bill will be noted not only by hon. Members but by those local authorities that are disposed to ignore current economic realities in framing their expenditure plans. I hope that they will note two points of profound importance. First, there will be no need for me to use the powers, and I certainly have no wish to do so, if all authorities follow sensible and moderate expenditure policies. Secondly, I shall not hesitate to use the powers forcefully and effectively, and to go on doing so in successive years, if they decline to bring their expenditure broadly into line with Government policy. The choice is very much theirs.
I turn to the question of capital controls, which is dealt with in clause 23. It is no less essential in present economic circumstances to maintain effective control of capital expenditure. Local authorities in Scotland have been generally co-operative in their participation in the financial planning system underlying its exercise of the power to control their capital expenses which section 94 of the Act of 1973 confers upon me, as they were with my predecessor. But the pattern of spending capital is clanging. A tendency to underspend, which was prevalent in many programmes until May 1979, has been followed by a tendency to overspend the diminished resources available. That resulted in minor excesses over cash limits last year. Local authorities have not found it easy to adjust their spending programmes to keep within a reduced cash limit, and for that reason I have had to review my powers under section 94.
The proposals in clause 23 are intended to improve our controls in two main ways. First, they will enable me to withdraw or vary, during the course of a year, any consent to incur capital expenditure. The power will be available only when the consent in question is not fully taken up. I grant that the power could be used to introduce a

moratorium on capital expenditure projects during a year, but it is most likely to be used, if at all, when spending by some local authorities proves difficult to rein in and is likely to endanger cash limits. It might then be necessary to delay starts or slow down progress on others.
Secondly, clause 23 will allow me to extend by order the scope of section 94, either by amending the definition of capital expenses or by bringing within its scope other forms of expenditure akin to capital expenditure, such as certain forms of leasing, as well as to extend the definition of capital expenditure, if necessary, to cover all forms of capital financed from revenue. The present practice of Scottish local authorities is such that such extensions are not required at present, but I must he able to exercise control over expenditure that is included within the relevant cash limits. I stress that I ant seeking a power to take certain action. Before exercising it, I intend to discuss with the convention the need for changes.

Mr. Jim Craigen: Do I understand that the Minister is anxious to encourage the practice of leasing?

Mr. Younger: I did not say that. I was simply trying to adjust the measures that are available to any Secretary of State in case there should be a growth of different practices such as leasing. Not only myself but any subsequent Secretary of State would find that necessary if new practices were to come into the way that local government finances its capital expenditure.
I turn to some of the other provisions of the Bill, beginning with the valuation and rating clauses contained in part I. Part I contains a variety of amendments to the Scottish valuation and rating code. Manifestly, they do not amount to the thoroughgoing reform of the rating system which I know some hon. Members would like to see and which remains one of our long-term objectives. The Bill is concerned not with fundamental changes in the system of local government finance but with improvements in the rating system for the time being. The powers conferred by clauses 1 and 2 might be required as a preliminary to more extensive reforms.
There is, of course, a strong case for regular revaluations of property to ensure a fair distribution of the rate burden, and on only one occasion has the regular five-year cycle of revaluations in Scotland been interrupted since it was set up by the Valuation and Rating (Scotland) Act 1956. But clearly there is no point in revaluing property if shortly thereafter rates are no longer payable on it, and it therefore seems sensible to introduce some flexibility into the arrangements for revaluations. Clause 1, therefore, will make it possible, by order, to change the dates for revaluations, while clause 2 will enable only certain classes of lands and heritages to be subject to the normal processes of revaluation. To make possible such a restriction in the scope of revaluations is entirely consistent with our policy towards domestic rates, which assumes that radical reform may apply to only one part of the rating system.
But reform may be some time off. In the meantime, it makes sense to maintain the rating system in good order, and clauses 3 to 11 will make useful improvements to the system in the interests of ratepayers and local authorities alike. The effect of clause 3 is that from the next revaluation, property in the commercial and miscellaneous classes will be valued by assessors direct to net annual value, which is the rateable value.
Clause 4 concerns the statutory table of deductions from gross annual value to which I have referred. Once clause 3 has taken effect, the table will be required for domestic property only, which will continue to be` valued first to gross annual value. The clause will enable any part of the table to be amended by order and thus introduce a valuable element of flexibility.
Clauses 5 and 6 relax minor requirements in the area of rating relief on property occupied by charities and on empty property. Clause 7 is intended to reduce the cost of rating authorities of collecting very small rate instalments, while clause 8 seeks to simplify the method of calculating the abated amount of rates due when a valuation appeal is pending.
Clause 9 will dispense with part-year increases in domestic valuations. Many hon. Members may have received representations from constituents about that matter. At present, assessors are required to alter a valuation roll not only to include new property but also to reflect changes in existing property. That means that ratepayers who alter their property—for example, by building extensions—are liable to be faced with supplementary rate bills in the course of a year. The effect of the clause will be that such increases in domestic values will take effect only at the beginning of the next financial year. That will benefit domestic ratepayers, who will no longer have to face supplementary' rate demands. It will also lead to a considerable saving of uneconomic work in rating authorities. It will be widely welcomed among many people who have been affected in the past.
Clause 10 makes a minor change in the constitution of the Scottish Valuation Advisory Council, while clause 11 amends the law on the enforcement of rate debts. At present, a sheriff officer enforcing a summary warrant against a rates debtor may seize not only the debtor's own goods or effects but also those in his lawful possession—for example, a commercial ratepayer may have goods on his premises left by a customer for storage or repair. It is unfair that a third party should be at risk of losing his property through no fault of his own, and the clause will remedy that position.
Part III of the Bill deals with housing support grants. The Housing (Financial Provisions) (Scotland) Act 1978 requires me when calculating the aggregate amount of housing support grants to estimate the aggregate income and expenditure on the housing revenue accounts of all Scottish local authorities, and the aggregate amount of the grants payable is the sum necessary to bridge the gap between reasonable local income and expenditure aggregates.
This worked well enough when every local authority had an excess of expenditure over income, because the figures for each authority had the effect of increasing the aggregate amount of grant. But the pattern of housing revenue accounts is now changing and we may expect the emergence of housing revenue accounts which are in surplus mainly because inflation has reduced the real burden of loan charges.
Obviously, if an authority has an excess of income over expenditure the inclusion of its figures will diminish the aggregate amount of housing support grant, with the result that there will not be enough housing support grant to meet the remaining authorities' reasonable need for support.
The problems which I have described were recognised by the housing finance working party, through which there is close contact between the convention and my Department.
Clause 18 will therefore allow me to fix the aggregate amount of housing support grants without regard to the income and expenditure of any authority if the inclusion of the authority's figures would diminish the aggregate amont of grants, and this will enable us to ensure that there will be enough grant to meet the needs of the remaining authorities.

Mr. Cook: Will the right hon. Gentleman take this opportunity to remove some of the confusion created by the clauses? Will he confirm that it is his intention to use these clauses—indeed, they can be used only in this way—only when local authorities are in real surplus and not when he thinks that they should be in surplus?

Mr. Younger: There is no intention to use these clauses in the way that the hon. Gentleman suggests. They are intended to deal with a position that would be disadvantageous to the generality of housing authorities. The precise purpose is to avoid an injustice to authorities generally if a considerable number of housing authorities that are in surplus are added to the aggregate. That would clearly be wrong and would work to the disadvantage of housing authorities. That is why we have introduced these provisions. There is no ulterior motive. These provisions are intended generally to improve the situation for housing authorities. I am sure that they will do so.
It is also possible under the prescribed method of distribution that an authority may not receive grant even where it has an excess of expenditure over income, and clause 18 will allow the exclusion of such authorities from the block calculation.
The purpose of clause 19 is to remove any doubt as to the competence of prescribing a method of distribution which does not allow a grant to be given to every authority. It is merely consequential on the previous provisions that I was mentioning. It also requires any particular exclusion to be stated in the table of grant entitlements which must be included in the statutory report accompanying every housing support grant order brought before the House.

Mr. Cook: I must confess that I am in a state of greater confusion following the right hon. Gentleman's response to my earlier intervention. I invite the right hon. Gentleman to tell me what is meant by the words that appear on page 8 in lines 24 to 27, which refer to
the aggregate amount of relevant expenditure…which could reasonably be expected to be credited to the…housing revenue account.
If those words refer to some curious figure that
could reasonably be expected to be credited",
what is that other than what he thinks the authorities should be receiving rather than the real amount that they are receiving?

Mr. Younger: The hon. Gentleman may be slightly put off by the form of the language. This is the normal means of expressing the amounts of expenditure that would normally be part of the credit side of the equation. It is done in this way in all the calculations of housing support grants.
It is the standard form of language and it will be familiar to those who have dealt with these issues. There is nothing


sinister in these provisions. COSLA's working party has participated in the working out of these matters. I believe that this part of the Bill will be widely welcomed. However, if there is an unexpected outcome, we shall be able to go into that as we consider the Bill in its later stages. It is intended to be helpful. I think that the hon. Member for Edinburgh, Central (Mr. Cook) will find that his fear is unfounded. I hope that he will.

Mr. Cook: So do I.

Mr. Younger: Part IV deals with a number of diverse matters, one of which I have already described — namely, the adjustments to the scope of my controls over local authority capital expenditure.
Clause 21 and schedule 1 make minor improvements to the provisions concerning the Commissioner for Local Administration in Scotland. The Commissioner has agreed to these amendments, which are mainly concerned with procedures and accountability.
Clause 22 provides for the relaxation of various controls which the Government exercise over local authorities and gives further expression to our policy that local authorities should as far as possible be free to carry out their functions without unnecessary interference. The controls themselves are set out in schedule 2 and cover a wide variety of matters, such as the approval of various fees and charges, the power to prescribe various forms of documents used by local authorities, and planning procedures. The planning relaxations relate to central Government control over the form and content of structure and local plans in particular cases, to the requirements for all stopping-up and diversion orders over highways to be made by the Secretary of State and to some minor compulsory purchase procedures. These are all quite important relaxations of control by the central Government on local government, and I hope that they will be welcomed not ony in the House but throughout local government.
We came into office months ago committed to a reduction in the number of non-departmental public bodies, or quangos as they are somewhat inelegantly known, and clauses 24 to 26 provide for the abolition of a number of such bodies which have outlived their useful purpose.

Mr. George Foulkes: Is it wise at a time when river pollution in Scotland is rapidly increasing—for example, in the Rivers Girvan, Doon and Ayr—to abolish the River Purification Advisory Committee, which has done sterling work? Will the right hon. Gentleman confirm that he has not allowed it to meet for the past year in spite of the chairman asking him repeatedly to allow the committee to meet? Is that not utter folly?

Mr. Younger: I appreciate the hon. Gentleman's feelings on that score. There is no shortage of advice on river pollution.

Mr. Foulkes: The right hon. Gentleman does nothing.

Mr. Younger: Advice on river pollution is available in plentiful quantities. It is not so easy to obtain the large amounts of finance that are needed to take the necessary action. We are not short on advice.

Mr. Barry Henderson: Is it not the case that the existence and functions of the river purification boards have not been affected?

Mr. Younger: My hon. Friend is right. I thank him for pointing that out. I was speaking of the availability of advice from the River Purification Advisory Committee.
The bodies in question were all recommended for abolition in the Pliatzky report published earlier this year. Indeed the abolition of the five new town licensing planning committees was also recommended by the Clayson committee as far back as 1973. Given the age now reached by all the Scottish new towns, it is clear that ample time has been given to the planning of any special arrangements that might at one time have been necessary for them.
Clause 27 is designed to introduce a measure of fiexibilty in the operation of byelaws made by a water authority or water development board to prevent waste, undue consumption, misuse or contamination of water. Circumstances may arise where a water authority or board feels that the byelaws are inappropriate to, for example, a new type of fitting introduced since the byelaws were made, and in such cases the clause will allow the byelaw in question to be relaxed. That, again, will be generally welcomed by local authorities and those involved in the water service.
Lastly, I mention clause 28, which suspends the operation of two provisions in the Education (Scotland) Act 1980 that were brought into force as a result of a technical error. They relate to the provision of written summaries of guidance for school leavers. The clause will bring careers service procedures in Scotland back into alignment with those in England and Wales.
I make no claim that all the provisions of this varied Bill will be welcomed by everyone in local authorities or by Labour Members. I would rather that some of the Bill's provisions—those regarding control of spending—had not been necessary. I regret very much that some local authorities have not responded in a sufficiently positive manner to the advice that I have repeatedly given them in the past year and a half to bring their spending down to reasonable levels. However, events have shown that the powers that I am seeking are necessary and I make no apology for bringing them in. Above all, they are necessary in order to be fair to the vast majority of local authorities, of all political persuasions—Labour and Conservative alike—that are doing their best in very difficult circumstances to get their expenditure under control. I do not suppose that they like doing it any more than I do, but they are doing it and they are being thoroughly responsible in what they do.
It has until now been common ground between both sides of the House that local government expenditure has to be reasonable in the national economic interest. The right hon. Member for Craigton preached that frequently when he was Secretary of State. I very much hope that he will confirm today that that remains his position. If he confirms it, he, will not have a leg to stand on if he wishes to oppose the Bill this evening.
I invite the House to approve the Bill.

5 pm

Mr. Bruce Millan: I can confirm right away that we shall be voting against the Bill this evening. After this morning, the doubt must be whether the Secretary of State will be voting for the Bill.
One would suppose from the bland explanation that we have just had from the Secretary of State of the provisions of the Bill that it was a little tidying-up measure of no real


consequence. However, it is a major attack on local democracy, as I shall prove when I come to the contentious parts of the Bill.
First, let me mention one or two of the other clauses. Part I of the Bill is concerned with valuation and rating. The amendments sought to be made are mostly technical and can no doubt be dealt with adequately in Committee. With regard to years of revaluation, I do not like any diversion from the normal quinquennial valuation. I say that not in any party spirit. It has happened under Governments of both parties, but it is undesirable that we should not have at least quinquennial valuations. If we do not, it simply gets the system out of date and is potentially unfair to various classes of ratepayer. I do not like the provisions in clauses 1 and 2 that deal with postponing revaluations.

Mr.Craigen: Does not my right hon. Friend suspect that there is some political calculation here, because 1983 will be the year before the next general election?

Mr. Millan: Of course I do. I am not quite as innocent as my hon. Friend supposes. That is why I do not like any measure that gives the Secretary of State power to change the year of revaluation. It is open to political manipulation, whichever Government are in power. Scotland has a better record than England on that matter in recent years. However, we can deal with that in Committee, too.
Clause 23 is again rather more than a tidying-up operation. As the Secretary of State was at least frank enough to admit in his description of clause 23, it will allow him to place moratoriums on local government capital expenditure. To ask us to believe that it is very unlikely to be used for that when the Government are at present imposing moratoriums in England and Wales on all housing capital expenditure and in Scotland on housing association capital expenditure is too much. If the clause goes through in this form, it will be used by the Secretary of State as justification for interfering even more drastically than he has so far with local authority capital expenditure. I therefore do not approve of it.
Clause 22 and schedule 2 deal with a mass of tiny reductions in the Secretary of State's control over local authorities. However, those relaxations are trivial compared with the massive increased powers of intervention in the affairs of local authorities that the other clauses will give to the Secretary of State.
Before turning to those clauses, I wish to deal with the housing support grant under clauses 18 to 20. The amendments are technical in one sense. The Secretary of State explained that. If a local authority drops out of the housing support grant calculations, it is necessary to exclude it from the calculations, otherwise a penalty is imposed on other local authorities. From a technical point of view, what the Secretary of State said is valid.
Unfortunately, the right hon. Gentleman does not understand his own Bill. He gave the wrong answer to my hon. Friend the Member for Edinburgh, Central (Mr. Cook) when he asked whether a local authority dropped out of housing support grant on the basis of its actual housing revenue account being in surplus or on the basis of the figures that are assumed by the Secretary of State, particularly in relation to assumed rents. The Secretary of State said that it is the housing revenue account. It is not. It is the assumed rent that determines whether a local

authority will drop out of housing support grant. The authorities that lose grant—and at least one authority will lose grant altogether in 1981–1982—do so not necessarily because their actual housing revenue accounts are in surplus but because the assumptions about rents give them a theoretical surplus in their housing revenue account. That is the reason for the provision.

The Under-Secretary of State for Scotland (Mr. Malcolm Rifkind): The right hon. Gentleman is seeking to suggest that there is a sinister purpose for the clause. He uses the reference by his hon. Friend the Member for Edinburgh, Central (Mr. Cook) to the words
could reasonably be expected to be credited
to imply that. I am sure he will appreciate, if he considers the matter, that those words have been taken from the Housing Act 1978, which was passed by his Government.

Mr. Millan: I am sorry to disappoint the Under-Secretary. That is not accurate either. The words quoted are a substitute for the words that appeared in the 1978 Act. In any case, what the hon. Gentleman said is irrelevant to my point. Authorities drop out of grant not on the basis of their actual housing revenue accounts but on the-basis of assumptions about rents.

Mr. Rifkind: That has always been true.

Mr. Millan: But the Secretary of State gave the wrong answer. He does not know the Bill and he does not know how the system works. He was asked a specific question and he gave the wrong answer.
I wish to develop the point. It is far more than a technical amendment. The technical amendment is required, because otherwise there could be unfairness to authorities that are still receiving grant. However, one has to consider the matter in the context of what the Government did about housing support grant for 1980–81 and what they are doing for 1981–82. We do not yet have the order for the latter year, and we shall debate it in due course. However, there was a meeting the other day when the Government's decisions were conveyed to COSLA. I do not have the full details of the figures, as they have not been published, but let us consider what is happening with housing support grant.
The Government are assuming that in 1981–82 local authorities in Scotland will put their rents up by 40 per cent., and the calculation of housing support grant is being made on that basis—a 40 per cent. rent increase, at a time when the Government are asking workers to accept a 6 per cent. wage increase. That is not only for 1981–82. We are told that it will also apply to 1982–83. We discovered that only because somebody leaked a Treasury document to The Guardian. No statement was made in the House, any more than a statement was made about the original 6 per cent. decision. However, the Government are, for 1981–82, assuming rent increases of 40 per cent. in the calculations of housing support grant. According to the latest figures, that means that whereas the housing support grant for 1980–81 was £228 million, the settlement that was announced recently for 1981–82 is only £139 million — a reduction of £89 million in the Government's support to local authorities on housing. I shall deal later with the question of the freedom of local authorities to decide their rates.
If we look at the housing support grant per house, the figures are even more striking. In 1980–81 it was £255 per


house and in 1981–82, on the figures that I have available—they may be altered by a pound or two here and there—it is only £156, a reduction of £99 in one year. One does not have to be a Main economist—to use the Secretary of State's words—to know that if there are two further reductions of £99 per house, theoretically every local authority in Scotland will be in surplus within the next few years and the housing support grant will be nil. That is the road down which the Government are going. They have reduced the grant by £99 per house, and if there are similar reductions in two successive years—the White Paper on public expenditure suggests that that is what the Government have in mind — no local authority will receive the housing support grant. These amendments, half of which are technical amendments, will affect the vast majority of housing authorities in Scotland.
The Minister finds that amusing, but the local authorities will not find it amusing, and when some Conservative Members discover that the reduction in grant for next year for their authorities is considerably more than £99 per house they will not find it amusing when they have to explain to their constituents how the Government are imposing rent increases on local authority tenants by a reduction of grant alone of more than £2 a week. I repeat that if this process continues Government support to local authority tenants in Scotland will be eliminated within a few years. That will he done at a time when all the tax concessions to owner-occupiers are being maintained and are increasing because of the monstrously high interest rates that owner-occupiers are having to pay. The Government will be making a massive attack on local authority tenants in Scotland in 1981–82. That is the significance of these clauses.
The Secretary of State has the hypocrisy to say that there is still some freedom for local authorities and that they do not have to increase their rents. He says that they can make their own decisions. But the assumption is that there will be a 40 per cent. rate increase, and the housing support grant is being cut accordingly. Then we have a "Catch 22" situation, because the local authorities are free to fix their rents at any level, but as well as having to impose massive rate increases—which will inevitably happen if the housing support grant settlement is imposed on local authorities, unless they raise their rates by 40 per rent.—they are being told that if they do not increase rents on the basis that the Government recommend there will be compensating reductions in their capital allocations. That is despite the fact that the capital allocations have, up to now, related to the local authorities' needs for capital expenditure. That was the reason why the previous Labour Government introduced the housing plan system. Now, for the first time, we have rents and capital allocations intertwined; and if local authorities do not raise rents as the Secretary of State dictates he will cut their capital expenditure.
The position is worse than that. If local authorities do not raise their rents and if they increase the rates instead, the Secretary of State will have powers under clauses 13 and 14 to decide that that expenditure is unnecessary and excessive and is leading to unnecessary and excessive increases in rates, and he will then reduce their rate support grant. Authorities that do not obey the recommendations of the Secretary of State on rates are faced with the choice

of increasing the rates—which many will do—having their capital allocations reduced and penalties being imposed by the rate support grant being reduced.
What freedom is that for local authorities? It is putting them in a straitjacket, and it is a major attack on local democracy. The Secretary of State said that the Bill was a little tidying-up operation, but it does not disguise the fact that he is taking powers out of the hands of district councils in Scotland and taking away the responsibilities that should rest with them to determine their housing policies in terms of rents, rates and council house sales. That has all been done against a background of capital allocations. But the capital allocations are already being slashed. I was told on 24 July that the capital allocations for 1981–82 were being reduced from £260 million to £190 million—a reduction of well over 20 per cent. in a single year. Those reductions will continue, and there will not be a decent public housing programme in Scotland. That will affect not only new housing but improvements. It has already affected the SSHA, which is laying off a large percentage of its staff, and it is also affecting the housing associations. This Bill constitutes a major attack on local authority housing in Scotland.
If the clauses on the housing support grant are shameful, those on the rate support grant are even more so. The Secretary of State says that these are just one or two technical adjustments to provisions that have been incorporated in the legislation for many years. The provisions in the 1966 Act go back even further—I think to 1948. They have been around for a long time, but they have never been used. They are not the same sorts of provision as are now provided in the amendments that are being inserted by the Secretary of State. This is a complete transformation of the position and of the relationship between the Secretary of State and the local authorities.
The Secretary of State is fond of quoting back to me statements that I made about local authorities keeping their expenditure under control. I have always taken that view. I took it in Government, and I take it in Opposition. I do not believe that local authority expenditure should be allowed to get completely out of control. But it is not out of control, and the Secretary of State did not inherit a situation in which many irresponsible local authorities in Scotland were spending excessively.
The actual expenditure at the end of 1979–80—this was mostly under the present Government—despite what was originally provided in the Budget, was less than had been provided for in the Labour Government' s rate support grant for that year. Indeed, if we look back at what happened under the Labour Government—and, for that matter, under other Governments as well — it can be shown that where authorities have been asked to restrain their expenditure, their response has been extremely good. It is not true that local authority expenditure is out of control.
It was the Secretary of State who mentioned the Lothian region. Therefore, I want to deal with that region. The picture that is usually given by the Secretary of State is that there were huge rate increases in. the Lothian region in 1980–81 because of an irresponsible Labour authority and that everybody else behaved admirably and impeccably. He has not complained about all the other local authorities in Scotland. Indeed, he goes out of his way to say—[Interruption.] The Secretary of State mentions Strathclyde. Let us look at the figure given by the Secretary of State, in an answer on 1 April 1980, about the


percentage increase in rates in 1980–81. The figure given for Lothian region—an "irresponsible" authority—was 41·5 per cent. The figure given for Strathclyde was 41·5 per cent.—exactly the same increase. That is a very responsible authority. I note that the Secretary of State is nodding.
When we look at the regional council increases generally, and not just in relation to Lothian and Strathclyde, we see a pattern which does not support the view that there are some irresponsible Labour authorities in Scotland imposing—

Mr. John MacKay: Will the right hon. Gentleman give way?

Mr. Milian: I shall give way in a minute. The hon. Gentleman is from Argyll. He does not have any colleges there and he does not have the Lothian region in Argyll, as far as I am aware. I want to make this general point and then I shall give way. If we look at the situation particularly in the regions, we find that the lowest increase for 1980–81 in terms of percentages was in a Labour-controlled region, the Central region. There are plenty of authorities controlled by friends of the hon. Member for Argyll (Mr. MacKay) which have massive rate increases in 1980–81, including, for example, the Borders region at 37 per cent.

Mr. MacKay: That is very interesting, but will the right hon. Gentleman read out the rate poundage? It will be seen that Lothian region's rate poundage is significantly higher than that of Strathclyde. Therefore, its percentage is, in real terms, much higher.

Mr. Millan: It is certainly true that the rate poundage in Lothian is a good deal higher than that in Strathclyde. The test that should be more appropriately applied is that of the amount of rate burden per head of population. One of the worst offenders is the Conservative-controlled Grampian region. There are all sorts of ways of looking at the figures, but in 1980–81 the increase in Lothian, as I indicated earlier, was no higher than the increase in Strathclyde.

Mr. Cook: My right hon. Friend will be aware and will no doubt wish to bring to the notice of the hon. Member for Argyll (Mr. MacKay) that the proportion of local authority expenditure met in Lothian by rate support grant is a mere 51 per cent. of the total, compared with a 65 per cent. average for Scotland, and that the total per capita expenditure by Lothian region is a mere 4 per cent. above the Scottish average and actually 4 per cent. less than the hon. Member's own Highland region.

Mr. Milan: The hon. Member for Argyll is not in the Highland region but is at the minute in part of the Strathclyde region, where the expenditure per capita is, I should imagine, a good deal more than it is in the Lothian region taken as a whole. The point is that the Government have been using the Lothian example to give the kind of general impression in Scotland that local authority expenditure is out of control and that there are large numbers of authorities that are spending the ratepayers' money without any regard at all for the consequences.
With regard to 1980–81, the rate increases everywhere in Scotland—

Mr. Younger: Mr. Younger rose—

Mr. Milian: Perhaps the right hon. Gentleman will allow me to finish this section of my speech. The rate increases in Scotland as a whole were massive, as I forecast at the time we debated the rate support grant order for 1981. I want to give the reasons why they were massive everywhere. Then, if the Secretary of State wishes to intervene, he can challenge what I say.
The rate increases everywhere in Scotland were massive in 1980–81 because the relevant expenditure on which the rate support grant was paid was unrealistically low, as we told the Secretary of State at the time. The rate increases were massive because the cash limit was faked by the Secretary of State on a phoney 13 per cent. inflation figure, and the underlying increase on which the cash limit was calculated was a total increase in expenditure of £307 million. The actual increase in expenditure because of inflation turned out to be £400 million.
Those were the reasons why everywhere in Scotland the rate increases in 1980–81 were very substantial. What is more, the position in 1981–82 will be just as bad, and in some areas it will be a good deal worse.

Mr. Younger: The right hon. Gentleman really has a nerve to take me to task for a so-called unrealistic cash limit of 13 per cent. when he bequeathed to me a totally unrealistic one of 5 per cent., which was a laughing stock. In case he has got the wrong end of the stick completely, I point out that it is not the contention that a vast number of local authorities are overspending. The contention is that a very small number of authorities are, if I may put it this way, taking the rest of them to the cleaners. The purpose of the powers is to take action against them and to take no action whatever against the vast majority of local authorities of all political persuasions which are spending reasonably.

Mr. Milan: We shall see what happens with regard to the use of these powers. The point that I was making—the Secretary of State did not answer it—was that the massive rate increases that we suffered in Scotland in 1980–81 were a direct responsibility of the Government's unrealistic and cheating rate support grant settlement of that year. What is more, the Government are obviously set on the same course of cheating the ratepayers in Scotland in 1981–82, because for next year they are to assume a further 3 per cent. reduction in the relevant expenditure, which is quite unrealistic. There will be a reduction in the rate of the grant from the present 68½ per cent. that has been announced by the Chancellor of the Exchequer, and there are to be cash limits which assume a 6 per cent. wage and salary increase for 1981–82.
The Secretary of State never makes any forecasts about rate increases. He is frightened to do that because he knows what the figures—[Interruption.] I shall give the Under-Secretary of State the record for the last two years of the Labour Government. My predictions were extremely accurate. If the Secretary of State or the Under-Secretary of State want to contradict them, they can do so.
The overall rate increase in Scotland for 1978–79 was only 6 per cent., and the domestic consumers paid 8 per cent. less than in the previous year. In the last year for which I was responsible, the overall rate increase for Scotland was 14 per cent. If we had had those figures for 1980–81 or could look forward to them for 1981–82, every ratepayer in Scotland would be very pleased. But the fact is that we shall have further massive rate increases in 1981–82.
What we have in the Bill is a smokescreen. It is trying to make the local authorities the scapegoat and to pretend that these great increases arise not just because of Lothian or one or two other authorities but because all the local authorities are very irresponsible, whereas the Government are terribly responsible.
There was an interesting editorial in the Financial Times, of all places, on Thursday 4 December. Admittedly, it was talking about England. Nevertheless, what it said is equally true of Scotland. The editorial began:
The maladministration of local authority affairs which has become something of a feature of recent Government performance continues to lurch from bad to worse. Ill-conceived attempts to combine hasty but radical reform with arbitrary economies".
It points out that if the Government could get their expenditure under control — including, for example, defence expenditure—as well as local authorities do, we should riot face some of the economic problems that now surround us. That is the background to clauses 13 and 14.
The Secretary of State referred to the powers conferred under section 5 of the 1966 Act. However, those powers go back to 1948. They are interesting because they appear in a different form. The original section said that he rate support grant would be reduced not only if a local authority's expenditure had been excessive or unreasonable but also if the local authority had not maintained a reasonable standard in the discharge of any of its functions. The Government wish to slash local authority expenditure. If that measure were applied now, no local authority would be able to demonstrate that it was maintaining a reasonable standard. All local authorities would have their rate support grant cut.
The provisions set out in the 1948 and 1966 Acts were couched in balanced terms. More importantly, they have tot been used since 1948. The intention behind them was not that the Government should intervene in the legitimate decisions of local authorities. The provisions were included as a means of protecting local authorities against those authorities that behave in a way that might directly reduce the grants available to other local authorities. Part II of Schedule 1 to the 1966 Act will be amended by clause 14. That provision was concerned not with unreasonable expenditure but with overrating. The manner in which the resources element was distributed meant that if a local authority were to overrate—that is, if it were to budget to spend "X" but to overrate for "X"—plus—it would receive an additional grant. That was unfair to other local authorities. However, it has nothing to do with the Government's present attempt to do the job of local authorities.
Clause 13 gives absolute power to the Secretary of State. He will determine what is excessive and unreasonable. Under the proposed subsection (1A)(b), the Secretary of State may have regard not only to the expenditure of other local authorities but to "general economic conditions". In case something might slip through the net, another little sub-paragraph has been inserted. It states:
to such other criteria as he considers appropriate.
In other words, the Secretary of State can use any criteria for his decision to cut the rate support grant of a local authority. The provisions could not be stated in more absolute terms. I defy the Secretary of State to defend that paragraph. It gives the Secretary of State complete power to intervene in the affairs of local authorities as he chooses

and without regard to overall circumstances. He can decide to interfere—against the wishes of elected local members — and he can decide the level of a local authority's expenditure.
The relationship between a Secretary of State and a local authority must be based on an element of mutual trust. That is true whatever Government are in power. Apart from that, the Secretary of State has massive powers over local authorities. For example, he can reduce the rate support grant percentage. Indeed, he will do that. He has absolute control over the capital expenditure of local authorities. The Secretary of State already has massive powers. He is being given an additional power, which represents a direct attack on local democracy. Indeed, it is also a vindictive attack.
The Government are attempting to make local government the scapegoat for their policy failures. Their policies on unemployment have failed. Their policies on industry have failed, too, and Scottish industry is breaking down on every side. They have failed to prevent massive rate increases in Scotland. Indeed, as a result of their actions, massive rate increases are inevitable in Scotland in the current year. The Government will allow that to happen again in 1981–82.
We do not intend to allow the Government to make local authorities the scapegoats for the Govermnent's failures. We intend to ensure that responsibility for those failures is pinned where it belongs. namely, on the shoulders of the Secretary of State. That is why we shall vote against the Bill.

Mr. Michael Ancram: I have listened with fascination to the speech of the the right hon. Member for Glasgow, Craigton (Mr. Millan). He said that the Bill represented a major attack on local democracy, and I waited to hear where he thought the major attack would come from. The right hon. Gentleman seemed to suggest that, as the Government were trying to gain a greater degree of control over local government spending, local government autonomy was somehow being diminished. He seemed to suggest also that the Government should rubber-stamp local government expenditure in order to protect that autonomy. I was fascinated by the right hon. Gentleman's argument because two years ago, when he spoke in favour of the Scotland Act, he de fended the idea that power over the revenue and expenditure of the Scottish Assembly should be held by the Government. At that time he told us that that was an extension of democracy. There is a strange divergence in his argument.
I was also saddened by the right lion. Gentleman's attitude. He spoke about the Government's vindictive attitude towards local authorities. Never once did he speak about the ratepayers. Year after year ratepayers in my constituency have suffered under the policies adopted by the Lothian region council, which has imposed excessive rate increases. If the Labour Party supports and represents the people, the right hon. Gentleman's attitude and concern for ratepayers should be greater.
Generally, I welcome the Bill because it shows that the Government at least are concerned about ratepayers. Part I contains relief provisions for valuation and rating, and I welcome them. They serve to underline the unsatisfactory nature of the present system of local government finance. As a lawyer, I practised for a short


while in valuation matters. I know that a veritable jungle exists when it comes to rating valuation. Most of that jungle has been created by regulations and reliefs—similar to those given in the Bill—that try to provide a greater degree of justice in an inequitable and unjust system. The provisions to which I have referred underline the need for reform. Any system that seeks to raise finance for local government should not be based on property alone. Domestic and industrial rating should reflect more the ability to pay. I know that the Government have gone through the options. None of the options proposed in the past have been without problems. None of them have been perfect, but I sometimes wonder whether they were not better than our present rating system.
Although I accept that the Government cannot come to a hasty decision, I ask them to continue to search for a better formula to replace the present rating system. In particular, I ask the Government to look again at the possibility of having a local income tax. I understand that the main objection in the past has been that where a ratepayer was being paid by an organisation or firm that was not based in his own rating area there would be difficulties in making the requisite deductions under a PAYE system.
That argument was significant two or three years ago, but I wonder how significant it is now when one takes into consideration the advance in computerisation. I understand that the Government intend to introduce a system of computerisation into the Inland Revenue. In those circumstances, I should have thought that it would be worth considering again a local income tax. I accept, however, that such a system would need one proviso, namely, that in the way that it operated the person paying it would need to understand what proportion of his tax was being paid for national tax and what proportion for local tax. If we are to have local government, it must, obviously, be accountable. Apart from that, I welcome the provisions in part I.
I welcome part II of the Bill because I believe that it contains a useful extension of powers to control excessive and unreasonable expenditure. If any questions are raised—as they were by the right hon. Member for Craigton—about whether the powers are needed, I believe, contrary to what the right hon. Gentleman said, that we need look only at that band of happy spenders, that flock of cloud-cuckoos who left their own lands and became the controlling Labour group in Lothian region. If I had any doubts about the extension of the power of the Government to intervene in local government, I can only say that, representing as I do an Edinburgh constituency and being an Edinburgh and Lothian ratepayer, those doubts were quickly removed from my mind.
I shall not go through the whole list, having done so before, but I want to give a number of examples of what I regard as excessive and unnecessary expenditure. Last year, at a time of restraint, there was an increase in staff of about 1,500, many of whom were on the administrative side and not producing anything directly for the consumer.
I shall give another example. A strange newspaper was pushed through my door the other day called the Lothian Clarion. It appears that this paper is the propaganda sheet of the ruling Labour group in Lothian region. I am told that, as a ratepayer, I am subsidising this publication to the extent of £25,000 a year to provide good publicity for a

small clique in the Lothian region. I find that the journalist who produces it is, surprisingly, the highest-paid journalist in Scotland. I understand that he receives £1,000 per issue. I am sure that there are not many other members of the NUJ who are subsidised to that extent.
Then there are the hare-brained schemes for the future. There is a suggestion that all transport in Edinburgh should not just be subsidised, as the hon. Member for Edinburgh, East (Mr. Strang) said, but should be free and that ratepayers should pay for the transport not only of other people in the city of Edinburgh but for the countless thousands of tourists who come there from America, Europe and Australia. It is proposed that those people should benefit from free transport at the expense of either the Government or the ratepayers.

Mr. Strang: The Lothian region bus system is an example to the whole of. Britain, in that it does not lose passengers at the rate that other areas are losing them. The system makes it easy for working people to travel quite long distances to work. Above all, it promotes energy conservation by encouraging people to go by bus rather than by private car.

Mr. Ancram: I agree with most of what the hon. Gentleman says, but to suggest that we should provide that transport free is to destroy the system and all its benefits. Even if that did not happen, the ratepayers would still have to pay.
My main objection to the Lothian region council is what I see as deliberate overspending to create political confrontation with the Government. I understand from remarks that I have heard that it has almost admitted that that is its intention. The council forgets that at the end of the day it is the ratepayers who are hit.
There is always the danger that attempts by the Government to control local finance can in themselves result in increasing the burden on the ratepayer, because local government passes the cost straight on to the ratepayer. We saw that happen last year. We must be aware of the problems that can result, not just in hardship to ratepayers, who see the cost of living in the capital city of Scotland continually increasing, but in the danger for businesses. The chamber of commerce in Edinburgh the other day suggested that as a result of last year's rate increase 3,000 jobs had been lost in the city, and this at a time when Labour Members, including the Lothian Labour councillors, are crying out against the Government because of unemployment. That cry rings very hollow after the effects of those rate increases last year.
It is in that light that I have looked seriously at the suggestions and proposals in part II. I and my constituents recognise a growing urgency as the annual rate settlement comes round again. I recognise that it is impossible for the Government to do what I hoped they would do last year, namely, impose a ceiling on rate increases, but I hope that the measures in the Bill will create a degree of control which in itself will give some protection to ratepayers.
As I understand it, clause 13, and, in a sense, clause 14, will neutralise the increase in local government spending by reducing the rate support grant by a similar amount. Here I have two worries, on which I hope that the Government will be able to reassure me. First, I hope that the retrospective nature of the decision by the Secretary of State on what is excessive and what is not will not be so retrospective that it will shut the stable door after the rate


increase horse has bolted. If that happens, it will only further endanger the well-being of the ratepayers in the region. I hope that my right hon. Friend the Under-Secretary of State for Scotland will be able to allay that worry when he winds up the debate.
My second worry is whether the Secretary of State will be able to give sufficient pre-indication to councils of his view of the level at which expenditure becomes excessive and unreasonable by setting out, at an early stage, the sort of criteria mentioned in the new subsection (1A), inserted by clause, 13(b). Paragraph (b) of the new subsection refers to
'general economic conditions'
and paragraph (c) refers to
'such other criteria as he considers appropriate.
That will at least give regional and district councils the chance to take such matters into account in planning expenditure for the following year.
I am confident that even Lothian region council, if faced with the certainty that it would not have any extra spending money as a result of excessive rate increases, would not have the temerity or the gall to hit the ratepayer for wheat would be purely political motives. That would be not only irresponsible but an abdication of the right to govern, and even the Labour majority in the Lothian region electorate would not save it.
In fairness, I should add that I do not believe that the Government can expect local authorities to read their mind. The, Government must give an indication in advance to give the responsible councils the chance to make adjustments
Subject to receiving those reassurances, I welcome—as I believe my constituents do—the genuine attempt in the Bill at last to provide some control over the councils that decide to fly in the face of national economic need and at the same time expect the ratepayers to foot the bill for their small political ambitions.
As the right hon. Member for Craigton pointed out, local autonomy is a precious right, but no right is sacrosanct if it is abused. The Bill at last gives a sanction against such abuses. I hope that it will be a warning to people who, like those in Lothian region, have for too long seen themselves as answerable to nobody. I hope that the House will support the Bill.

Mr. J. Grimond: This is the sort of Bill that makes me weep. In spite of piles of recent legislation about local government, there is still a great need for a few simple reforms. Unlike the hon. Member for Edinburgh, South (Mr. Ancram), I do not think that the Bill will achieve them. I do riot believe that it begins to touch the heart of the matter which faces us in local government.
I was surprised by the complacency with which the Secretary of State spoke of his relationship with the local authorities. I seem to remember a circular sent round by the Under-Secretary, the hon. Member for Edinburgh, Pentlands (Mr. Rifkind), saying that the authorities' level of staffing was totally unacceptable. I seem to remember the Prime Minister saying that one of the most serious matters that faced productive industry was the burden of the rates. I seem to remember many Government spokesmen saying that one of the difficulties of the Government in remaining on course was exactly the high level of public expenditure, both nationally and locally.
It is true that the local authorities have got their expenditure under much better control than the central Government have, but I thought that whether it was good enough was a matter that the Government disputed. To my mind, the local authorities are expanding without much logic, largely because of the appalling mass of legislation under which they have to operate. They are following very much the course that the Government have followed over the past seven years.
The first thing that needs to be done is to define local authority functions. At present, in addition to their traditional functions, which are important enough, they are becoming involved in industry, development, agriculture, fishing, archaeology, archives, art, dancing, port management and playgroups, to mention only a few of those that one reads about every day in the newspapers.
If the Government believe that local expenditure is in danger of going too high, they should cut out some of those functions. However, if, as they seem to say this afternoon, there is really only one local authority in Scotland of which they complain, it is wrong to introduce a Bill such as this for what appears to be a limited purpose—to deal with one authority. After all, the Government have powers already to deal with capital expenditure and the rate support grant. We have already heard quoted the provision in clause 13 which enables the Secretary of State, in cutting the rate support grant, to take into account
any other criteria which he thinks appropriate.
It should be resisted by Parliament if the whole thing is a trivial matter applying to only one local authority.
The constant growth in the functions of local authorities is causing great problems over finance and in other ways. Local councillors are neither elected nor equipped to deal with most of the problems. They are part-time, busy people.
Secondly, there is gross duplication. No fewer than five authorities now deal with agriculture in Scotland.
Thirdly, there is a conflict of interest between the councillor as representing his constituents and as a member of a local authority that is often doing the very things that are complained of. There are extraordinary secondary results. For example, there is the burden put upon Shetland, owing to the increase of rateable values, in paying its contribution for the northern police.
If the Government intend to see that local expenditure is under better control all round, and if the Bill is not simply a punitive measure against Lothian council, they must make up their minds to take one of two courses. One is to institute a prefectorial system, depriving the local authorities of many of their present powers and making St. Andrew's House directly responsible. I should regret that, but it is true that much of local authority finance comes from central Government. If that were done, at any rate we should know who was responsible.
The other course, and the one that I hope the Government will take, is to give the local authorities more discretion. It is no good the Secretary of State saying that the Bill relieves the local authorities of many obligations and that it gives them more freedom. The freedom given is trivial compared with the sanctions that may be brought against them.
If more freedom is given to local authorities, there must be new methods of raising finance. Here I agree with the hon. Member for Edinburgh, South. The Conservative Party promised to abolish the rates. What has happened to that promise? However bad a local income tax might be,


if anyone now suggested the rating system all the civil servants would say "It would be totally impossible to run such a system." The right step for the Government is to look at new methods of local government finance.
If the Government are to allow local authorities discretion to take on wider and wider responsibilities—that may be right, if they are properly equipped and financed, and if they take the responsibility — the Government should look at the functions of other public authorities. For example, if the local authorities are going into development, as they are, what about the Highlands and Islands Development Board? If they are going into agriculture, what about the Crofters Commission? I should regret the break-up of the pool of expertise accumulated in the board and the commission, but it is illogical to have five bodies dealing with agriculture in Shetland. There is much to be said for local authorities taking up new functions, but it had better be done clearly and responsibly and be properly financed. In addition, the responsibilities in question must be taken away from other bodies.
The Bill falls plumb between the two stools. It partly gives the Secretary of State more power and then says "After all, he will not take any responsibility."I understand that the right hon. Gentleman can reduce the rate support grant if he thinks that the local authorities' estimates are excessive or unreasonable, but he takes no responsibility for the consequences. He takes pride in that. He says "I am not concerned with the results. It is up to you to decide what to do with the money. All that I shall say is that you are spending too much." There are no proper criteria for coming to that conclusion. There is a reference to
general economic conditions; and
(c) to such other criteria as he considers appropriate.
The answer is that if the Secretary of State is to act responsibly he will have to make inquiries into why and how the projected expenditure that he does not like has come to be thought necessary. There is a vast variation among local authorities. It is absurd to apply on a general rule of thumb to Orkney, Strathclyde, the Borders, Edinburgh and everywhere else. How is the right hon. Gentleman to judge? He will have to have more officials so that he can look into the question and decide whether the expenditures are justified.
There is an extraordinary provision that the Secretary of State may redistribute the amount that he has forbidden to one authority. Will that mean that authorities that have not asked for more will be given more money, which they must spend, because some others have been penalised? This is an extraordinary method of conducting local authority finance.
We come next to the curious provision in clause 23 by which the Secretary of State may withdraw his consent or vary the conditions upon which consent has been given for capital projects. Already the grants system is extremely wasteful. It encourages authorities all the time to spend every penny they can. How often have hon. Members been told when something is proposed "The Government will pay 75 per cent"? All local authorities with any sense will now enter into irrevocable contracts as soon as they can be assured that a grant has been approved. Instead of spreading the cost over the year, they will enter into such contracts because they cannot be upset by the Secretary of State.
In the Shetland Times last week there was an article—I do not know how accurate it is—which said that the SIC is proposing to spend £10 million more than the Government are prepared to allow, because the Government have got the figures wrong. I can well believe that. I should like to know how this matter will be resolved. It will be a most extraordinary situation for the local authorities if approved capital projects can be axed. It will kill any planning, proper budgeting or estimating if authorities cannot know months beforehand whether the matter has been approved or will be torn up. Parliament should not lightly pass over that matter.
I am as concerned as the Government about the constant increase in staff expenditure by local authorities. However, I am not clear that the effect of the Bill will not end up creating more staff. The last time the Conservative Party attempted to reform local government, the result was an explosion in staff expenditure.
In The Scotsman of 15 October there were some alarming figures. Many local authorities have greatly increased their staff. Lothian has already been mentioned by the hon. Member for Edinburgh, South. But Strathclyde has increased its staff by 1,464 and Shetland has increased the number of staff by 124. I do not think that the Government can say that the position is quite as satisfactory as the Secretary of State made out.
The point is that the Government either should take some responsibility off the local authorities and the ratepayers or, as I would recommend, should say to the local authorities "Do what you think best—but you must pay for it."
The Western Isles authority has a considerable number of staff—about 2,000. But the Countryside Commission is now to take part in the planning of the Western Isles. That sort of lunacy uses more staff and causes more expenditure. Yet the Government do not appear to be doing anything about it.
The Bill will create an ill feeling in some local authorities, and, after a certain amount of trouble, inflation will continue as before.
It may be argued that, as there is a Bill of this sort for England, Scotland must have one, too. I implore the Scottish Office not to saddle Scotland with this Bill. If it has sensible proposals of a basic nature for local government reform and finance, let it bring them forward on the lines not that local authorities should be more hampered but that they will be responsible to a greater extent for their own expenditure and decisions. Of course, the Government will have to support them up to a point. But we want to move towards a more sensible method of local finance and of making the local authorities and all their constituents more responsible for the way that they conduct their affairs. How can the Government, without an enormous number of staff, know better than the local authorities what their needs are?
It is true that under the present rating system some people can get rate rebates, so that they do not mind if the rates go up. It is true that industry may have little say in local government. But these anomalies can be tackled.
Essentially, if we believe in local government at all, the Bill is moving in the wrong direction. I ask the Government to withdraw it and to bring in a more sensible Bill.

Mr. Ian Lang: Since 1 o'clock this afternoon I have been trying hard to work out how a carefully prepared and well argued speech on the teacher training colleges in Scotland might be recycled to apply to the Local Government (Miscellaneous Provisions) (Scotland) Bill. I fear that I have failed, but perhaps some of the less discerning Labour Members will hardly notice the join.
I welcome the Bill. However, I welcome some of its proposals with sadness, partly because the philosophical thrust of the Conservative Party has always been away from centralisation—for keeping in local hands as much control as possible—and partly because it is a sad reflection on the nature of local government that its participants should now tend to seek to use their position either to defy the Government or to advance a particular party political point of view. The days of selfless civic service seem to be long dead in some parts of the country. Too often, local authority councillors are seen as the frontline troops of the party political battle that takes place in this House, or even as representing a third House of Parliament.
The crucial feature of our form of representative democracy is balance. The evolution of checks and balances between Government and Opposition and between the different estate; of government is essential as a safeguard of our liberties. The Bill recognises a shift that has developed there. It may be to some extent a result of the 1975 reform of local government, which has few friends in the House or elsewhere. The Bill seeks to restore the balance not just of the relationship between local government and central Government but between ratepayer and local govern merit and, on a wider note, between the individual and the State. In that sense, it could be argued that this is a progressive Bill.
The biggest shift of all in local government has been the shift in manpower, which accounts for about 70 per cent. of local authority costs. In 1955 there were only 750,000 local government employees in Britain. Now there are 2 million. Fifty years ago the public sector employed 7 per cent. of our work force. Now it employs more than 30 percent. Governments of both political complexions have recognised that problem.

Mr. Norman Hogg: Does the hon. Gentleman accept that there has been a massive extension in the amount of legislation that local authorities are required to carry out and that the statutory functions of local authorities have changed markedly since the year that he quoted and that that accounts for the increased manpower? It is not that the local authorities wish to increase their manpower just for the sake of providing employment; it is out of necessity.

Mr. Lang: I accept that there is something in what the hon. Gentleman says. I shall come to that point later. I do not accept that local authorties increase their manpower just because they want to do so. This problem has been recognised by Governments of both political complexions. The previous Labour Government, which the hon. Gentleman supported, succeeded in cutting numbers by about 12,000, with no appreciable loss in services. That proved that it could be done. Now, with local government pending up by one-third in three years and with numbers up by 15,000, there is undoubtedly a need to do that again.
That represents an increase of about 6 per cent. in local authority manpower. Certainly, no one can claim that there has been a 6 per cent. improvement in the quality of local government service. The new element that has entered the debate is that local government is now adopting—

Mr. Cook: The hon. Gentleman referred to a most striking figure, and I should be grateful to know his authority for it. He said that local authority expenditure went up by one-third in three years. If he referred to the Government's White Paper on public expenditure, he would see that during the past three years that figure has actually fallen by £45 million in real terms.

Mr. Lang: I cannot lay my hands on the exact figures at the moment. However, it is clear that local authority employees have increased by 15,000, and that 70 per cent. of local authority expenditure is on manpower. In this area there has been no comparable improvement in the quality of local government service.
The new element entering into the debate is that local government is now adopting resistance not just to protect its empires but to make a political statement against the Westminster Government. Not all local authorities are alike, but this trend has become increasingly marked in recent years. It is one for which the Bill makes provision.
The Dumfries and Galloway regional council, for example, employed 34 fewer people this year than it did in January 1975. That figure would have been 80 fewer but for the 46 staff compulsorily transferred from central Government. It was also struck after including increases in the numbers of both police and firemen as a result of changes in establishment and the length of the working week. In June this year the number of employees in the Dumfries and Galloway regional council was down by 26 compared with June last year. Expenses have been well contained, despite its vast population in a widely scattered area. They are consistently low in the league of cost per head in all Scottish local authorities.
Why should the Dumfries and Galloway regional council be penalised for the extravagance of other regions such as Lothian and Strathclyde, each of which has recruited about 1,500 new employees in the past year? Those local authorities would argue that that was necessary to fulfil the new tasks imposed upon them by the Government. But it is estimated that the new tasks amount to less than 10 per cent. of the increases. If Dumfries and Galloway can absorb such duties without an increase in staff, surely other regions can absorb such increased duties.
I do not believe that the 3,227 increase in social service workers employed between December 1977 and December 1979 or the 1,113 extra employed on recreation, leisure and tourism are justified by Government requirements. Yet such increases have taken place in the two-year period, at a time of growing world recession and when there is a need for restraint in expenditure at all levels, private and public. Opposition Members who shed heavy tears at the high unemployment level should ask themselves whether they have considered how many productive, wealth-creating jobs have been lost and how many good, long-established companies have had their backs broken by the burden of rate increases—a burden that has been expanded without thought for those who must carry the increases.
Many hon. Members could give a number of examples of unnecessary expenditure by local authorities. Today's Glasgow Herald carries the announcement:
Two Scottish regional councils are to make a joint appointment of a 'dancer in residence' with the help of money from the Scottish Arts Council.
That is a £6,000-a-year job with Fife and Tayside regional councils, with the assistance of the Scottish Arts Council. I have heard of people tripping the light fantastics, but this is tripping the light incredible. Dancing is a delightful art form, whether it is disco, ballet or Scottish country. I am sure that the Scottish Arts Council is well able to justify its part in the appointment. However, I wonder what on earth a "dancer in residence" has to do with the provision of services in local government.

Mr. Tam Dalyell: Has the hon. Gentleman had the courtesy, or has he bothered, to make inquiries of the council?

Mr. Lang: I have not had the opportunity to make such an inquiry, because I was present in the Scottish Grand Committee this morning and in the Chamber throughout the afternoon. I have no doubt that if the councils feel that the appointment can be defended they will manage to so defend it. I am sure that the press will afford them all the necessary courtesies. If precedent is followed, the dancer will soon want a partner. Then he will want an accompanist, and a clerical assistant; and they will all want premises and parquet flooring. I have no doubt that in a year or two the ratepayers of that part of Scotland will be able to attend free concerts by the "Fife Formation Dancers" assisted by the "Central Region Light Orchestra". The two regional councils are leading the Government a merry dance.
That is why I welcome the Bill. Many of its clauses are non-controversial and enlightened by any standards. I particularly welcome clause 13, which gives the Secretary of State power to reduce the rate support grant to a local authority where estimated expenditure is excessive and unreasonable. I welcome clause 14, which allows the Secretary of State to calculate the resources element according to a lesser rate poundage than the actual rate poundage. I also welcome clause 23, which allows the Secretary of State to withdraw or vary a consent given to a local authority to incur capital expenditure. One overriding criterion should guide the Government in their action. Profligate councils should not benefit from their profligacy and prudent councils should not be penalised for their good behaviour.
The explanatory and financial memorandum, under the heading
Effect of the bill on public service manpower",
states that some of the provisions
should provide some scope in the longer run for minor savings in local authority manpower.
I hope that the overall effect of the Bill will be much more substantial in relation to local authority manpower. Indeed, I wonder whether the Bill goes far enough. I ask my right hon. Friend to consider making it compulsory for regions and districts to publish their manpower figures annually, broken up by sectors, so that the ratepayer can see what he is paying for.
I wonder, too, whether my right hon. Friend should take power to impose a maximum ceiling for rate increases in any one year, perhaps related to the inflation rate. I

recognise that the constituent parts of the retail price index might not be compatible with local government expenditure patterns. However, a limit of perhaps 150 per cent. of the retail price index increase in any one year, except on the Secretary of State's dispensation, might afford some protection to the ratepayer.
If my right hon. Friend is exercising control through the resources element, the rate support grant and capital expenditure, the pressure on rates, geared as they are by the two-thirds rate support grant contribution, could be considerable. I understand that the other powers will be exercised only after the rate poundage has been determined and that this cannot then be changed for that year. That is, perhaps, a measure of protection. However, I still believe that the added powers that I have outlined might be appropriate. It is vital that the burdens incurred by irresponsible local authorities should not be passed on to innocent ratepayers.

Mr. Cook: Will the hon. Gentleman give way?

Mr. Lang: I shall not, since I have already given way to the hon. Member.
An entirely bogus argument was repeated by the right hon. Member for Glasgow, Craigton (Mr. Milian), that the Government have no right to interfere in local government. I observe in passing that as two-thirds of the cash expended by local government is not ratepayers' money but taxpayers' money, collected by the central Government and distributed by them to local authorities, the Government have not only a right but a duty to intervene in order to protect the taxpayers whom they represent.
The right hon. Member for Orkney and Shetland (Mr. Grimond) said that in the long run it was desirable to replace rates with a fairer tax. Some form of local income tax, as my hon. Friend the Member for Edinburgh, South (Mr. Ancram) suggested, might be appropriate. That could be levied by the local authority and collected by the Inland Revenue through the PAYE system. The suggestion is that such a system would lead to the creation of 12,000 new Civil Service jobs. However, as my hon. Friend the Member for Edinburgh, South said, the increased use of computers might obviate the problem.
In the meantime, I wonder whether the Secretary of State will consider whether some items should come off the rates. For example, education is the largest single item of expenditure under the rates and it might be more appropriate for part of that to be taken over by the Government. Perhaps a measure of increased fairness could be arrived at by allowing rate payments to be a deductible expense against income tax.
Certainly, the burden of taxation has shifted unfairly to rates from income tax. In Strathclyde some ratepayers have experienced a sixfold increase in rates over a seven-year period. Other hon. Members will be able to produce similar examples. Until a fairer tax can be found, the Bill is a welcome measure to protect the individual against high-handed local authorities. It protects the virtuous local authorities from the less virtuous. It protects the Government's overall economic strategy from sabotage at local government level. It reasserts the sovereignty of Parliament itself. For those reasons, I give the Bill a warm welcome and wish it a speedy passage.

Mr. Donald Stewart: I hope that the hon. Member for Galloway (Mr. Lang) will excuse me if I do not deal with his speech in detail. He said that some good firms had had their backs broken. The firms and the CBI agree that the main reason for that is the action by the present Government since they came to power.
The Secretary of State said that the choice was that of the local authorities. It is obvious that the choice resembles that given by Henry Ford w hen he put his model T on the market. He said "You can have any colour you like so long as it is black." The Secretary of State says that local authorities can have certain powers as long as they do what they are told. The hon. Member for Edinburgh, South (Mr. Ancram) said that local autonomy was a precious right. So it is, but it cannot be bounded by anything that the Secretary of State of the day might wish to do.
The Bill is an attempt to extend Government control over local authorities. That is ludicrous when the majority of the Scottish people rejected a Conservative Government at the general election. They made it clear that they did not want the present Government's policies. A minority is dictating to the majority in Scotland. That proves that the Government think that the democratic process can be ignored there. As we heard today, the majority view is likely to be sacrificed to the axe-swinging English Treasury, even when members of the Government refuse to vote for and back their own policies. If a Government and their supporters do that, it is time they filed a petition in bankruptcy.
The explantory and financial memorandum to the Bill suggests that the Secretary of State is relaxing his control on local authorities — for example, in terms of the appointment of social work directors, dealt within schedule 2, paragraph 14, and other items such as the disposal of land forming part of an open space. But the financial rigidity with which it is to be imposed will make it virtually impossible for heal authorities to make local decisions of any importance. Where is the "local" in local government if its hands are tied behind its back and big brother is watching all the time?
An article in The Scotsman refers to the comparable English Bill, although it also applies to what is being attempted here today. It states:
The Government are in the process of making the most decisive step yet in the shift from powerful, financially sound local authorities to dependent, centrally controlled satellites, according to a major critique of recent trends which is published his week.
The authors of that critique said:
Its efects will be within a very short time to replace genuine local government by the dependent outposts of a large central bureacracy … it marks the beginnings of a wholly centralised state.
That has been done by the Conservatives, who allege that hey are so concerned with freedom.
The main point of contention is the rate support grant. Local authorities are to have their grant reduced when the Government deem their expenditure to be excessive and unreasonable. Clause 13(b) suggests that the Secretary of state should have regard to similar authorities. But the idea of comparison in Scotland is ridiculous, because of the disparate nature of the authorities in the various geographic areas and the population. Therefore, it is impossible to have arty meaningful comparison. How would one compare my constituency and local authority in the Western Isles, which will have to increase its rates

by at least 47 per cent. and which has been designated by the Common Market Commission as one of the most disadvantaged areas in the British Isles, with, say, Orkney and Zetland, with its vast input of oil revenues, or with Strathclyde, Grampian, Lothian or any other area? No meaningful comparison is possible.
Objections to the Government's proposals are coming from a wide area, including independent members and COSLA as a whole. Little account has been taken by the Government of the difficulties caused by rising costs of labour, material and so on, and authorities have already had to trim services. This started at the time when the Labour Chancellor, with his IMF deals, made them go on cutting. If they constantly cut services, there will be opposition from the public about cutbacks in home helps, special provisions for the handicapped and so on. That has already started, and it will increase. Allowances must be made for those costs.
Allowances must also be made for functions that have been laid upon local authorities by Governments of various colours. If those functions are to be wished upon local authorities, the Government must continue their funding.
Rates will have to rise sharply if authorities are to maintain their services. It is one choice or the other. The Tories are for ever preaching about protecting the ratepayers. It is not a question of asking ratepayers to subsidise others; it is a question of trying to maintain standards.
As to housing, the main effect of the Bill is to reduce the housing support grant, which is the Government's contribution to the local authorities housing income. According to Shelter's figures, it would be reduced from more than one-third in 1979–80 to one-fifth in 1981–82. Increased rent must be seen against the background of unemployment and poor housing conditions in many areas, rural as well as urban. It is grossly cynical to contemplate charging more for inadequate housing. Unemployed rent payers will receive a rebate, which must be met by the Government in any case, so there is unlikely to be real gain against the background of Scotland's appalling unemployment figures. It seems likely that the level of support available through the housing support grant will continue to be reduced in the next several years.
The Secretary of State referred to the abolition of quangos in relation to clauses 24 to 26. One quango that has aroused great opposition in the Highlands and Islands is the Countryside Commission. Local authorities fear, with good reason, I believe, that it will inhibit development. Its control covers 20 per cent. of the Highland region and 40 per cent. of the Western Isles. Members of local authorities in those areas are local residents and, as such, have some regard to their environment. They do not wish to see it spoilt, but they know that people have to live and that there must be some development. This quango is the authority that assured the Inland Revenue that the Vesteys ought to get a big cutback if they kept the whole Assynt estate free of any development whatsoever. That does not engender belief in anything that the Countryside Commission might do. Those authorities have good reason to be afraid. I hope that it will be possible for an amendment to be accepted, if not to wipe out the commission at least severely to clip its wings.
We oppose the Bill. It has a facade of improvements, but in reality it is chipping away at freedom in Scotland


and at freedom for the local authorities. It is an attack on the local authorities and, indirectly, an attack on the living standards of the Scottish people.

Mr. John MacKay: I begin with part I of the Bill, which is concerned with the general problem of the rating system. I give a warm welcome — [HON. MEMBERS: "Ah".] I suggest that hon. Members should wait around. I might not give so warm a welcome to other parts of the Bill. However, I give a warm welcome to clause 1. Some considerable time ago, when my right hon. Friend the Secretary of State for the Environment announced that he intended to delay the English revaluation, I asked my right hon. Friend the Secretary of State for Scotland whether he had the same intention. At that point, he said that he did not have the powers. I am, therefore, glad to see that he is taking the first step along that line by seeking those powers in clause 1.
That means that the revaluation due in 1983–1984 can be delayed if the Secretary of State decides that it should be and comes to the House with a resolution to approve that. I see that the hon. Member for Central Ayrshire (Mr. Lambie) is not in his place. I know that we would agree on this, if not on much else. I know that the revaluation that took place in 1978–79 was a traumatic experience for many ratepayers and householders in Argyll and Ayrshire.
There are problems still unresolved arising from that revaluation. Indeed, one of them had to be resolved in the other place by putting a clause into the Local Government, Planning and Land (No. 2) Bill to exempt fish farms from rating, because the assessors would not accept that fish farming was an agricultural pursuit. I cannot imagine what they considered it to be, if not an agricultural pursuit. A great deal of difficulty was caused for the fish farming industry and there was a great deal of uncertainty about its future. That industry is of great importance for employment on the West Coast of Scotland and also for the provision of foodstuffs for the people of the United Kingdom. That is one example of the repercussions of the 1978–79 revaluation that is still with us.
Many other matters are not yet settled. The legal position may be settled but the aggravation remains. For example, one of my constituents is having a triangular battle with the Post Office and the assessor. The Post Office has decided that he lives in a rural area and should have only one postal delivery a day, and that there should be only one daily collection from his local post box. Yet the assessor has decided that he does not live in a rural area and that his rate assessment should, therefore, be considerably higher. The assessor, needless to say—and any hon. Member who has had dealings with the assessor knows that he always wins—has said that he takes no account of definitions that other bodies may give to where people stay. My constituency, like parts of Ayrshire, has been subjected to a traumatic experience as a result of that revaluation.
At the beginning, some doubt was expressed by the convener of the Strathclyde regional council, but it is now generally agreed that by revaluation alone more than £1 million was removed from the ratepayers of the county of Argyll. That excluded all the other increases that one naturally expects at times of inflation such as we have experienced during the last five or six years.
I think that I now understand clause 2, but I should like to make a few points about it. I presume that it means that a revaluation in 1983–84, or five years after that if we continue with this system, could be for certain items only. I presume that that is to allow for a separation of domestic and commercial rating and that a revaluation may take place in respect of commercial rating only, thus leaving domestic rating as it is, on the ground that perhaps during the next Parliament the Government will have found a way of removing domestic rating from the scene and financing local government in another manner.
I am a little suspicious of that method of going about things, because rates weigh heavily on commercial and industrial users. My hon. Friend the Member for Galloway (Mr. Lang) mentioned that point. Whether firms are profitable or are just getting by, the rate bill still comes in and it must be paid. It is not like other forms of taxation where if one makes a profit one pays tax but if one does not the tax man does not come. The rate man always comes.
Although the right hon. Member for Western Isles (Mr. Stewart) engaged in some knockabout arguments, I accept what he said. If asked, business men will tell us that high interest rates are a problem, but the House is not being honest if it fails to realise that the same business men will blame high interest rates, high wage increases and rates. They will probably say that all three are to blame. That has certainly been my experience. High interest rates are now on the way down, and it is to be hoped that that downward trend will continue. Wage increases, certainly in the private sector, are moderating substantially, but commercial and industrial people cannot see rates doing the same.

Mr. Dewar: Perhaps the hon. Gentleman will turn his mind to last year's rate support grant, which was almost certainly the shape of things to come. That forced large rate increases upon local authorities. Will the hon. Gentleman condemn that in the interests of the business men to whom he has just referred?

Mr. MacKay: That illustrates a problem to which I shall come a little later. It concerns the relationship between central and local government, how much of local government expenditure the central government ought to pay and at what stage the balance between central and local government gets totally out of hand. However, I agree that that is one of the input factors.

Mr. Foulkes: Perhaps the hon. Gentleman will also agree that many business men are going into liquidation or receivership because they are not getting local authority contracts, as a result of cutbacks in public expenditure.

Mr. MacKay: I have no doubt that some business men are not getting the contracts that they thought they should. Indeed, one of my criticisms of the Government's general policy of cutting expenditure is that they find it a good deal easier to cut capital projects rather than revenue projects. That applies to every Government, including the previous Government, because in 1976 the IMF came along and did the cutting for them. That fault can be laid at the door of the present Government, just as it can be laid at the door of their predecessors. It would be splendid if a way round that problem could be found, but it appears that it is extremely difficult to cut revenue.
There is an interesting situation in Strathclyde, where the council is no longer giving financial help under the


sewerage Acts — which it ought to give — to private developers. It says that it has run out of money, although the staff that is supposed to operate those grants and schemes still exists, in spite of there not being much to do if no grants are given.

Mr. George Robertson: What should Strathclyde regional council do? Is the hon Gentleman suggesting that it should build the sewerage systems that he considers to be essential, or should it sack the personnel that will be necessary if those sewerage systems are ever to he built at all?

Mr. MacKay: I think that a balance could be struck. What is the point of retaining staff if there is no work to do? If a reduction in staff could be achieved, some of the money saved could be used to allow some of the most important projects to proceed. However, I find it odd that half-way through the financial year, when it must be obvious and easy to predict the kind of expenditure that one will have, the council has run out of money. I strongly suspect that it has moved the money to some other sphere. In fact, I am pretty certain that it has moved the money to something for which it has under-budgeted. It then diverted the money away from this sphere, presumably because it involves private housing that the council considers to be of lower priority than that to which the money has been devoted.
I should like to add my voice to those of hon. Members who have already spoken about the basic unfairness of rating. I agree with the point made by the hon. Member for Glasgow, Garscadden (Mr. Dewar) about the balance between central and local government finance. It is difficult to be a local authority when so much of the money comes from the. Government and the rest comes from a system of financing that is unpopular with the portion of the electorate which bears it. The majority of the electorate who do not pay rates really could not care less one way or the other.
At one stage an hon. Member referred to the Layfield committee, which looked into this matter deeply. I know that it found insurmountable difficulties in all the alternatives. If there were no local government rating, if the committee had looked at some other form of local government taxation as being unsatisfactory and if someone had gone to the Layfield committee — for example, a Labour Member— and come up with the ilea of local rating, it would have rejected that, perhaps a great deal more quickly than it rejected the other systems.
We have become used to rating. It is simple and inexpensive to collect. It is what we live with. Therefore, when we look at the alternatives we try to find all the difficulties that are associated with them. Sometimes that blinds us to the difficulties of the rating system. There are difficulties associated not oaf with the actual assessments but with the way in which they are based on house values. Indeed, it is doubtful whether they are based on house values at all. At times they seem to be figments of the assessor's imagination. About two-thirds of the average electorate do not pay rates. I do not know whether that is representation without taxation, but it is certainly something like it. It means that a local authority can be less than interested in its ratepayers when it realises that thirds of its electorate do not pay rates. I am not suggesting

that local authorities are like that, but there must be a temptation to punish the ratepayer on the ground that he forms a minority of the electorate.
I hope that my right hon. Friends in Scotland and England will look seriously at an alternative to rating, because I do not think that it is a system with which we can continue for ever. We must find some alternative.
Clauses 5 and 6 also relate to rating like so many other things, attempt to smooth over some of the problems of the rating system. These clauses relate to charities and remissions. I should like to refer to various community activities and assets that people work for, finance and build but find that year after year they are hit by the assessor, who asks for quite a lot of money. I am not talking about elaborate projects; I am talking about facilities such as playing-fields — if they are entirely community-based and have nothing to do with the local authority—pavilions and all the other things which are not charities, which do not get rating relief and which pay annual values.
At present, I am arguing a case with the Home Office, the assessor and anyone else who wishes to have an argument with me about it. It relates to what are called active television reflectors, which are an important means of getting television reception for many people in remote rural areas. As for the finances for those reflectors, the Highlands and Islands Development Board is very good at giving grants, the local authority is good at giving capital grants and the local community raises a considerable amount of money. That is fine for the capital grant. But then people discover that after the wee bit of equipment is put up on a hill, along comes the assessor and bungs on an assessment that means that they will have to pay rates year after year in order to receive television programmes—a facility that all the rest of us get from a mast that is paid for, in rating, by our licences.
These are the kinds of unfairness that the charities provision does not stop. They are very real, especially in the small communities. There may well be examples in the cities also. Communities carry out self-help and go for the capital part of self-help and work hard to get the capital but then discover that the assessor knocks them for six because of the running costs that he imposes on them. That is quite unfair.
If we are to continue with the rating system—this is something that my right hon. Friend might consider in a year or two, when he sees when the next revaluation will be—I think that the suggestion that I am about to make ought to have been in the Bill, but I shall let my right hon. Friend off for the fact that it is not in the Bill on the assumption that there will not, one hopes, be another revaluation. There have been many appeals in my constituency and in Ayrshire. The people who are appealing and questioning their assessments found the procedures most inadequate. They found that the assessor gave them information partially and very reluctantly. They found it very difficult to decide whether they ought to appeal and whether they had any grounds for appealing. When appeals reached the courts, it took some very clever legal footwork by at least one lawyer in Argyll, on appeals committees, to drag out from the assessor the basis on which he had made his assessment.
That is fine if one gets as far as the appeals committee. It is fine if one can afford a clever legal operator who can work hard at this and make sure that he drags the facts out of the assessor. But how will the ordinary person, looking


at his rates assessment when it comes in after a revaluation, be in a position to judge whether it is fair, whether he should appeal and whether he should go to the lawyer who specialises in the matter and can help him if it reaches the appeals committee? The assessor ought to be forced to give very much more information to the ordinary ratepayer who questions him before he ever considers having to take the matter to an appeals committee.

Mr. Peter Fraser: While my hon. Friend is developing this theme of the inadequacies of our appeals system against valuation, will he bear in mind that those who make an appeal, either to the committee or to the court in Edinburgh, traditionally never get their expenses paid, and that this is undoubtedly something of a restraint against proper appeals?

Mr. MacKay: Absolutely. That is right. I came across this in many circumstances. One group got round the difficulty by banding together and persuading the appeals committee that rather than hear an appeal from every house in the area they should take a test case. They all put their hands in their pockets and got their lawyer. I am happy to say that he was the gentleman who pulled more facts out of the assessor than the assessor had ever willingly let go. Those people got a reduction in their assessment. Therefore, the money that they spent on legal fees was well worth it.
I come now, taking them together, to parts II and IV. [HON. MEMBERS: "Oh."] I am surprised that Opposition Members have not developed their arguments a little. The right hon. Member for Western Isles did so.

Mr. Foulkes: We cannot do so. The hon. Gentleman is talking all the time.

Mr. MacKay: There is a difficult relationship between central Government and local government. In part IV, my right hon. Friend is reducing his control over local government—some of the controls relating to planning, for example. I welcome that, because even though the planning authority—I am not particularly talking about my own—may not always make the correct decisions, I do not think that lots of inbuilt appeals to the Secretary of State necessarily improve the decision-making. However, I hope that my right hon. Friend will ask the local authorities to exercise their planning procedures with a little more feeling for the objectors. At present, an applicant whose application is refused has the power to appeal, but objectors do not have that power. I do not think that there is any way round that problem, but local authorities ought to work quite hard at making sure that objectors feel that their cases are heard. It is not just a case of a letter being put in. Objectors should know that the letter was read and that the point was listened to and answered.
Like the right hon. Member for Western Isles, I find it a bit of a contradiction that, at the same time as my right hon. Friend is relaxing controls on planning, local plans and the like, the Countryside Commission, in many areas of the Highlands, including parts of my constituency, is being given a little say in the planning procedures as an objector — a say that is not being given to other objectors. The commission does not have to object to the

local authority in its planning decision. After the plans are passed by the local authority, the commission can put its objections to the Secretary of State, and then the Secretary of State can intervene on the planning decision.
I am sure that my hon. Friend the Minister remembers two cases in Argyll shortly after the present Government came to office, in which I think it was quite clear from the reporter's report on those cases that the Countryside Commission had absolutely no justification for asking the Secretary of State to call in the plans. I do not know whether the commission has whispered in my right hon. Friend's ear since then, but I am delighted to say that no other planning applications for my part of the world have been called in at the say-so of the commission.
However, I am a bit worried that the commission is being given rights that no other objector has been given. I accept that in areas of great natural beauty, which we have in the Highlands, more people than just those of us who stay in them have an interest in them. But if the commission could put in its oar at the planning committee stage, so that its opinion was read and listened to by the planning committee, the committee could judge whether the opinions of the commission were valid in certain cases. That would be better than giving the commission a privileged position without anything being in the Bill to give it that position in law. That is a most disturbing thing.
I come to the other side of the matter. I question to what extent the Government should interfere in local government. We have an obligation to make sure that we do not ask local authorities to carry out tasks that will cost them money and then complain that they are spending money. We have an obligation, along with them, to look at functions that are being duplicated by us and them, and perhaps saving either them or us money, but saving one of us money. When the Stodart committee reports, I hope that it will suggest ways in which the two tiers may be prevented from overlapping as much as they do. They overlap on industry, planning and tourism. They have officials and offices for those matters and others. That is wasteful and unnecessary expenditure. If the Stodart committee makes recommendations along those lines, I hope that the Government will listen carefully to them and talk to the local authorities, and see whether we can remove those extra unnecessary expenses on the ratepayer and the taxpayer.
The great problem, about which the hon. Member for Garscadden intervened, is that the Government pay two-thirds and the ratepayer one-third. I am being rough about this; we do not need exact figures. No one can say that the Government, on behalf of the taxpayers, should stand aside, take no part and say nothing about overspending by local authorities. Indeed, the one-third who pay rates often look to the Government to help them if their local authority is overspending.
I shall go into the problem of Lothian. My hon. Friend the Member for Edinburgh, South (Mr. Ancram) has done his bit on that. He has pointed out repeatedly the extra expenditure that Lothian undertakes. It annoys authorities that try to do their housekeeping, including Labour-controlled authorities, to see an authority such as the Lothian authority—in a much more prosperous area than Strathclyde—come out with a higher rate poundage than Strathclyde does. That is unfair.
However, what is more worrying—my hon. Friend did not mention it, but I read about it in the newspapers, although perhaps it is totally made up by the press; I do


not know — is that both the Lothian region and, I believe, Dundee are actually spending more money in order to wreck the Government's spending plans and in order to embarrass the Government. I hope that that is not the case, but if it is surely no hon. Member can support such action,. That kind of motive, if it exists, is totally irresponsible. If those local authorities are pursuing that course of action they are bringing the whole of local government into considerable disrepute. That worries me, because local government is an essential part of our democracy.

Mr. Foulkes: I know that the hon. Gentleman has a lot to contribute, but does he not think that he is bringing this debate into disrepute by continuing at such great length when so many other hon. Members wish to contribute?

Mr. MacKay: I was just thinking about concluding, but I am greatly tempted now to continue and to annoy the hon. Member for South Ayrshire (Mr. Foulkes), bearing in mind the number of times that he has annoyed me by going on. However, I shall resist the temptation.
I do not know whether I shall serve on the Standing Committee that examines the Bill. If I do, I shall look for ways—including those that I have mentioned—to insert new clauses or to make amendments to cater for some of the points that I have been advancing. That statement may perhaps guarantee that I am not selected for the Committee.
On clause 28, Labour Members will be delighted to hear that when I first say the Bill I rushed off to the Library for a copy of the Education (Scotland) Act 1980. They will be equally pleased to know that I have nothing more to say about it, except that I welcome my hon. Friends decision not to implement these clauses at this time.

Mr. Hugh D. Brown: Some of my hon. Friends are being slightly uncharitable about the contributions of Conservative Members. I am referring not just to the length but to the quality of those speeches. Some of my hon. Friends will not be unaware that the conservative Members will reaffirm their vows of silence by the time that they get to the Committee. It is refreshing [or those of us who served on the Standing Committee that examined the Tenants' Rights, Etc. (Scotland) Bill, which sat 30 times, to hear those Conservatives today, because this is the only chance that we have had of understanding some of their views.
It has been a depressing day for the Government. The performance this morning in the Scottish Grand Committee will be well reported in Scotland. The Prime Minister's irritability at Question Time is being increasingly noted. The only other disaster that can befall the Government today is for the hon. Member for Glasgow, Hillhead (Mr. Galbraith) to make another speech.

Mr. Dewar: That is unlikely.

Mr. Brown: Yes. He is bound to have been exhausted by his efforts this morning.
There is much in the Bill that merits the close scrutiny that it will undoubtedly have in Committee. The Bill is in various parts, not all of which are related or linked. The contribution by my right hon. Friend the Member for Glasgow Craigton (Mr. Millan) was excellent, in contrast

to the tawdry approach of the Secretary of State. the Secretary of State was far too technical and theoretical. He failed to face the underlying philosophy behind some parts of the Bill.
I want to deal only with the housing support grant and the housing aspects of the Bill. I understand that clause 23 is part of the mechanism that will or can be used by the Secretary of State to impose restrictions on capital expenditure by local authorities out of revenue. In other words, section 94 of the existing provisions is to be tightened and implemented to make sure that there is restrictive control over the capital expenditure programmes of local authorities. Will the Minister state the existing percentage of capital programmes that are financed out of revenue that could be caught by this provision in the current stage?
Clause 22 deals with the relaxing of controls. Everyone agrees with it in principle, although we feel that the example given about no longer requiring the sheriff to give permission to increase burial charges is not particularly relevant or likely to be a major issue at the next election. Nevertheless, it is a welcome trend in minor details, and I only hope that the Government, in their inability to produce anything worth while, will rot just gather these statistics together and claim for them more than they are worth.
I move on to stress the significance of the changes in the level of housing support grant. I remember the debates when we introduced the principle of these grants. Some of my hon. Friends were a little unfair at that time, but I do not complain about that. I think that they now realise that the principles that we were trying to apply were sound. Those principles were to ensure fairness between one housing authority and another.
The dispute is about the amount of Government support that is injected into the system and the method of distribution. The principle of applying the greatest help to those in greatest need is impeccable. It is a Socialist principle, and that was the rationale behind it. This Government, however, are using the machinery savagely to attack the local authorities.
My right hon. Friend the Member for Craigton mentioned the figures, and I shall repeat them I understand that the level of Government support in 1980–81 is about £228 million, falling next year to £140 million. That is mainly based on the assumption of rent increases. The Government cannot impose rent increases on housing authorities, but they can make it extremely difficult for the authorities to avoid rent increases if one of the options is a cutback in capital expenditure. That is part of the strategy of attack on the authorities, where the Government are not just being punitive but are preventing them from carrying out the policies on which they were elected and which it is worth while for them to pursue.
I should remind some of my hon. Friends not to express surprise at what we are receiving from a Tory Government. The Secretary of State was the man who introduced the Housing (Financial Provisions) (Scotland) Act 1972. I see him nodding, so he is not disputing that. I am sure that the right hon. Gentleman will not dispute that it was the intention, properly and fairly stated, that within about 10 years public expenditure committed to public housing should be phased out. The right hon. Gentleman is not disputing that, either. So, by this method


he is almost back, at his second attempt, on target. That is an outrage in view of the problems being faced by some authorities.
Glasgow is expecting to have its capital expenditure reduced in 1981–82 from £61 million to roughly £55 million. I know that there may be variations in the figure. That is not a housing policy. It is an attack on local government, because it is consistent with the only policy that the Government have, that of selling off council houses. The Government must find some way of putting pressure on local authorities to see that they reduce capital expenditure, either by savagely increasing rents or by selling council houses. That strategy will fail. That is one of the factors that perturbs me. I hate to put myself in any category, but I am concerned at the unrest that exists in many of Scotland's local authorities. The Government must accept some responsibility for it.
Some Conservative Members need enlightenment on Labour Party politics. I wish that they would come to us and discuss them instead of getting their information from the Sunday Post, the Sunday Mail or wherever. There are many new, active, almost revolutionary councillors in Scotland. Being revolutionary has nothing to do with Marxism. [Interruption.] I am trying to make a serious point. They are new, keen and, in some cases, young members of Labour-controlled authorities, who may not have been members of the party for very long. They now find themselves in local government and in the majority. It is not surprising that within months of being returned in May with a substantial majority they want to show their strength. I wish that the Government would take on board the strength of feeling that exists in many Labour-controlled authorities on these matters.
Let us not forget that those councillors are disputing, wrongly in my view, the Government's mandate for selling council houses. There is a strong body of opinion against that. They will not be enamoured of these further attempts by the Government to restrict their ability to manoeuvre and to carry out the policies on which they were elected. I am sorry to have to say that. I am sorry that my hon. Friend the Member for Dundee, West (Mr. Ross) is not in his place. I regret that Dundee district council has taken the decision that it has. I do not think that it has a mandate from the Labour Party to do that. Whether or not it has a mandate does not matter. It has no right to say that it will not implement section 1 of the Act.
I must make it clear that I do not support that view, even though someone might extract this snippet of my speech for the reselection conference that I shall face some time soon. I shall go even further. I do not agree with the Glasgow branch of NALGO on the action that it has taken. The sooner that NALGO members get off their backsides—

Mr. Norman Hogg: I wondered when that point would be made. I am surprised at its source. The NALGO position on the matter was determined at a meeting of the national executive on 22 November, which said that it would not encourage NALGO members to engage in activities aimed at refusing to implement the Act. At 3.30 pm today, any decision on the matter was deferred by the national executive so that further consultations could take place. That is the union's position.

Mr. Brown: I am sure that my hon. Friend appreciates that I was attacking not NALGO as a whole but only the decision of the Glasgow branch that deals with the housing management department. I make no apology for that. I do not care how strongly that branch feels. I did not see any great evidence of the members of the Glasgow branch coming out in their hundreds to help us at the district council and general elections.

Mr. Norman Hogg: They were all in East Dunbartonshire.

Mr. Brown: My hon. Friend can justify the actions of NALGO if that is what he wishes, but I think that we are discussing a dangerous principle. I do not accept the right of a handful of people to thwart the elected representatives of either local or national Government. That is something that must be said. I feel strongly about the matter. We are being jockeyed into a position where an assumption is being made that, in some magic way, our Labour colleagues in local government can prevent rent and rate increases or avoid redundancies in such a way that if they accept any of these propositions they will be regarded as Right-wing reactionaries. I am not prepared to go along that road.
I am disturbed at the Government's attitude towards housing. They are blatantly putting the screw on district councils with housing responsibilities. I could quote the speeches of the Secretary of State and the Under-Secretary who during past years complained that we were not making available enough resources to deal with dangerous housing and houses with damp and condensation problems. The Under-Secretary even supported a quite irresponsible amendment on the housing support grant, and in an unbelievable manner.
New councillors have been thrust into positions of responsibility. In some cases they are compelled to say to people that, even if their houses are dangerous because of faulty wiring, capital expenditure allocation is such that the programmes will be delayed. If a house is unsatisfactory because of damp or condensation, they are having to tell people that they are sorry but they will have to put up with that because the allocation is not being made. In those circumstances, it is absurd to make wholesale condemnations of Labour-controlled councils which are desperately anxious about the position. They are having to retreat from some of the commitments that they gave at the district council elections. They are genuinely concerned about the responsibility for postponing programmes when people's expectations have been raised.
The Government should be ashamed of themselves. It is not only their attack on local government that is at fault. Their whole economic strategy and policies are wrong. They should feel ashamed when they consider some of the problems in the deprived housing areas in Scotland, because their first priority was to give concessions to taxpayers earning more than £10,000 a year. That is obscene. Their economic policy is wrong. It is forcing them to introduce legislation such as that before us today. I shall put in the maximum effort not only to vote against the Second Reading but to challenge the legislation throughout the country whenever I have the opportunity.

Mr. Peter Fraser: When speaking from the Government Back Benches, I suppose that it is


traditional to welcome a Bill. However, I am bound to say that I do not welcome the Bill—but I must face up, as must all Conservative Members, to the fact that it is, regrettably, necessary. My right hon. Friend the Secretary of State said that it is the responsibility of local authorities to have regard not only to their local areas but to the National interest. Until May of this year, I enjoyed a certain smug complacency on the issue. I represent a constituency that had a Tory-controlled regional council and two Tory-controlled district councils. However, since then I have had to have regard to the district council to which the hon. Member for Glasgow, Provan (Mr. Brown) referred, namely, Dundee district council. The hen. Gentleman deserves some credit for having spoken upon the matter. It was clear from his words that he was referring to that council. He referred to the attitudes of the new, young, wild men in the. Labour Party in local government.

Mr. William McKelvey: Is it not a fact that the Dundee young councillors said in their manifesto that they would not raise rents? They are now keeping a political promise—something that is rare these days. They should be applauded for it. They were elected with large majorities.

Mr. Fraser: The hon. Gentleman does not realise that hat attitude is more prevalent than only in Dundee district council. Before the hon. Member for Provan spoke on that issue, it was only the hon. Member for Caithness and Sutherland (Mr. Maclennan), from the Labour Party in Scotland, who had the courage to say that Dundee district council was behaving irresponsibly. Now that the hon. Member for Provan has joined him, I must give him a warning. On Monday of this, week, the hon. Member for Caithness and Sutherland enjoyed a leader all to himself in the Dundee Courier and Advertiser. I wonder whether the hon. Gentleman wishes to have that credit bestowed on him when he goes forward for reselection.

Mr. Hugh D. Brown: I have stopped giving press handouts. I am not reported on anything that I say, so it does not really matter.

Mr. Fraser: I shall ensure that the hon. Gentleman receives a copy of the Dundee Courier and Advertiser. If lie does not receive it, I shall make sure that his management committee does.
There has been a dismal failure in Scotland to show responsibility for the national interest. As my right hen. Friend the Secretary of State for Scotland said, it is a problem that has confronted not only him. It one that confronted his predecessor, the right hon. Member for Glasgow, Craigton (Mr. Milian). The only politically controlled authorities in Scotland that showed responsibility for the national interest were the Conservative ones. My right hon. Friend has paid his compliments to them in the past for the opportunity that they have given him to try ID manage the economy of Scotland in the national interest.
I was astonished when I read the figures which appeared for the first time during the Summer Recess and which gave the breakdown of the employment of local government officials in Scotland. They revealed that after two and a half years there had been an increase of about 15,000 in the number of local government employees. We were told that Tayside region and Angus district had made

massive cuts. They made cuts in staffing levels of 3 per cent. If that 3 per cent. had been reflected throughout Scotland, there would have been a decrease in the number of local government employees of 18,000 for 1979–80 rather than an enormous increase over two and a half years.
Labour Members have recently shown a new-found concern for the private sector in Scotland. If they really have that new-found concern, I ask them to ask industrialists to ask small businesses to ask those in commerce in Scotland if they have truly felt that a 3 per cent. reduction in the level of local government staffing has damaged their businesses or whether alternatively, and far more obvously, it has relieved them of a burden. There will be few companies in Scotland which will be able to come through the deep worldwide recession if they cannot make that 3 per cent. economy. They will have to be fit and lean.
Through the speeches of my hon. Friend the Member for Edinburgh, South (Mr. Ancram), it is clear that the Lothian region has been elevated to the top of the hit list for the Secretary of State for Scotland. I ask him in the forthcoming months to ensure that he has his sights trained northwards towards the Tay. I suspect that he will have similar problems in that area.
It has been claimed with no lack of concern by Dundee district that it anticipates increasing rents, if it is permitted to do so, and hope that it will not, by about 200 per cent. The reason for that is that the district follows avidly the economic school represented by the hon. Member for Dundee, West (Mr. Ross). Part of the economic thinking of the hon. Gentleman is that the rates burden for business and industry is irrelevant. He is willing to see imposed upon business and commerce in Dundee an additional rates burden, but he is at the head of the queue waiting to see my right hon. Friend the Secretary of State for Scotland to ask him to pour more money into Dundee to assist business. I think that everyone can see the inconsistency in that approach. Part of the present that my right hon. Friend might give to the hon. Member for Dundee, West is a small pocket calculator.
The most vexed issue of public expenditure is capital expenditure. I recognise that my right hon. Friend has considerable problems in trying to control all forms of capital expenditure. I raised the issue with him when he gave evidence to the Select Committee in Edinburgh. We should be working harder to secure the essential distinction between revenue expenditure and capital expenditure. The last things that we want are grandiose schemes that will boost the self-importance of certain local representatives.
I accept that increased capital expenditure cannot be allowed if significantly increased revenue implications can be identified. At the same time, I feel something of a sense of despair when seeking to support capital schemes promoted by Tory controlled authorities that are well aware that they must not in their wake bring in schemes that have high revenue implications. They are as well aware of that as I am, but they find from time to time that they are trapped in elaborate calculations to determine what they can spend when those calculations seem to be but dimly connected with the public sector borrowing requirement or any other measurement of any increase in public spending.
I hope that the Government will apply the stick firmly to local authorities that are irresponsible, especially on the revenue side. However, I hope that a carrot will be offered


to responsible local authorities in the form of a more sympathetic approach to their applications for capital expenditure items. I hope that my right hon. Friend will be able to give effect to what I know he believes to be right, and that if there are sensible capital expenditure programmes in the right areas they will be of benefit to local communities and a boost to the private sector.

Mr. Robin F. Cook: I hope that you will forgive me, Mr. Deputy Speaker, if I preface my remarks by saying that I and a number of my hon. Friends think it unfortunate that on a night when eight Back-Bench Labour Members have been seeking to catch the eye of the Chair none of them will be successful in doing so until nearly eight o'clock in the evening.
I understand that minority parties have their rights in the House. I understand also that it is for the occupant of the Chair to safeguard those rights. However, it is perhaps unfair that they should be treated consistently as surrogate Labour Members and that we should find ourselves drawing towards the close of the debate to when only one Labour Back-Bencher and four Tory Back-Benchers—it is characteristic that none of the Tories could muster one hour's experience of local government — have contributed to the debate. I shall be obliged, Mr. Deputy Speaker — I think that this applies to some of my colleagues — if you will draw the attention of Mr. Speaker to my remarks.

Mr. John MacKay: I do not mind the hon. Gentleman hurling insults, but does he realise that I served on a local authority for five years before reorganisation?

Mr. Cook: I am much obliged to the hon. Gentleman. I accept that correction. I wish that the hon. Gentleman had put that information in his printed biography. I withdraw my earlier remark. I made an error and I apologise. I have acted on the basis of printed information and, as has so often happened, it has misled me. However, that does not alter the fact that we have had four Tory Back-Benchers participate in the debate and only one has served in local government.

Mr. Deputy Speaker (Mr. Richard Crawshaw): Order. The hon. Member for Edinburgh, Central (Mr. Cook) is wasting time. The Chair is not unmindful of those who have been trying to catch the eye of the Chair as opposed to those who might enter the Chamber later.

Mr. Cook: The Bill should be resisted by the House because it marks one more step in the relentless march towards central control by the Government over local authorities and local authority decision-making. There is a cosmetic attempt in schedule 2 to pretend that restraints on local government are being removed by the Government. Some of the provisions in schedule 2 amount to no more than pleasing jests. Presumably they are intended to give light relief to those who sit in Committee considering the Bill.
Surely, that Committee is not intended to take seriously the provision that local authorities should no longer be encumbered with the obligation to lay down standards for cattle grids. The Committee will not be impressed to discover that local authorities will be given their own freedom and discretion on tree preservation and in

deciding how they should style their chairmen's title. They are not the stuff of local authority elections. They are not matters that call for further local authority expenditure or staff. To pretend that that is removing in any serious degree central Government control over local authorities is totally bogus.
It is paralleled in the Bill by clauses that effectively garrot local autonomy by using local authorities' own purse strings to strangle them. Reference was made to clause 23 by my right hon. Friend the Member for Glasgow, Craigton (Mr. Milian). It provides an entirely novel power for the Secretary of State to revoke capital consent that he has given to local authorities, provided that they have not entered into a binding contract. There are no grounds provided in clause 23 as to when the Secretary of State may invoke those powers. He does not have to display any conditions or show that any condition has been fulfilled. He merely has to decide that he will invoke his blanket powers under clause 23.
That must worry the House. It is a power being sought by a Government who have shown that they are willing, by sudden, disruptive and damaging intervention in local authority affairs, to cut back their capital programmes. They are a Government who are so besotted by their own monetarist dogma that they have introduced a moratorium not only on housing expenditure but even on defence expenditure. They have put thousands out of work, bankrupted small firms and thrown the programmes of the Ministry of Defence and local authorities into disarray, and yet they have the nerve to pretend that these moratoriums somehow will contribute to economic recovery.
The clause is of rather academic interest to Lothian region, which already is not allowed to spend any capital money unless we speak nicely to the Secretary of State, send him a little essay in justification of the project and wait six months. I should like to share with the House some of the projects that have been caught by the provision. One is the provision of highways and sewers on industrial estates. That is the expenditure which Lothian region wants to undertake and which is called irresponsible. That is the controversial expenditure. That is what the Secretary of State is resisting. Private sector firms are encountering delay in the provision of factory units because Lothian region has not been allowed to finance highways and sewers.
There is also the provision of a social work centre at one of the growth areas within Lothian region at Livingston. Livingston now has over 10,000 households. It has no social work centre. Therefore, Lothian region applied last spring for permission to construct a social work centre at Livingston. [Interruption.] The hon. Member for Edinburgh, South (Mr. Ancram) finds that funny. I am sorry to see that. He has over his years in public service given an impression of concern for social issues and social services. I am sorry that he sees it as a jest that a major community in the region that he has the honour to represent in this House should be denied such a facility.
Since the spring, Lothian region has had no response to its application for capital consent. As a result, it has paid £20,000 to the contractor to keep alive the tender which has been held up by the Government. That is not saving money. It is an egregious waste of public money. That is' the kind of consequence of rule from St. Andrew's House.
It will become widespread if the House is foolish enough to entrust to the Secretary of State the powers that he is seeking in clause 23.

Mr. Rifkind: Has the hon. Gentleman considered why the Secretary of State feels it necessary to impose that restriction not on local authorities generally but on the one authority to which the hon. Gentleman refers?

Mr. Cook: I know perfectly well why the Secretary of state has taken such powers over this local authority. He is seeking a scapegoat. He is seeking to penalise one local authority which happens to have been hounded by the press, with great co-operation from the Under-Secretary of State and his hon. Friend the Member for Edinburgh, South, to whose speech I shall be turning shortly. There is no evidence whatsoever in the expenditure of Lothian region to justify the way in which it is being victimised by the Government. As I said earlier when I intervened in the speech of my right hon. Friend the Member for Craigton, Lothian region is spending exactly 6 per cent. more than the Scottish average per capita and substantially less than many other regions, which does not justify the way in which it has been singled out for treatment by the Government.
We all know well — I am grateful to the Under-Secretary for drawing our attention to the matter again—which authority will fall Foul of the powers in clauses 13 and 14, if they are carried. It will be Lothian region again. I shall tell the House why the Secretary of State is seeking new powers under clause 13 rather than relying on the existing powers in the 1966 Act. The reason why he is not relying on the powers in the 1966 Act is that they can be invoked by him only when the outturn figures are available He knows full well that the reason why the rate poundage in Lothian region this year is higher than that in other regional authorities is that it refused to accept the right hon. Gentleman's figure of 13 per cent. for price inflation and included a figure of 15 per cent. Lothian, like all other authorities, is heading for a deficit, but it is less than that which has been incurred by other regions. Strathclyde's deficit, even on a proportionate basis, is well over double that of Lothian region. Strathclyde—and one cannot blame it for that — accepted the Government's figure of 13 per cent. as the figure for pi-lee inflation.
The Secretary of State now knows, because we are sufficiently far through the year, that at the end of this year when the outturn figures arc available he will have very great difficulty using his powers under the 1966 Act. When he gets to court, it will be obvious that the difference between Lothian and other regions is not that it was more extravagant but that it was more prudent than the others in making better allowance for inflation. The Under-Secretary laughs, but it remains a fact that Lothian region's deficit is less than the deficits incurred by other local authorities.
That is, why the Secretary of State is seeking power that will give him the right to intervene at the estimate stage, although II honestly greatly doubt whether St. Andrew's House is in a better position to provide an estimate for each local authority than the officials and councillors who have represented those authorities over a period of years. However, he will be able in go to court without being encumbered by the awkward reality of discovering the out-

turn figures across Scotland. That is why there is that provision in the Bill and why the right hon. Gentleman is seeking the power.

Mr. Rifkind: If the hon. Gentleman really believes that, can be explain why the Lothian region is the only regional authority in Scotland this year that has planned for a growth in its budget? That was a major factor in the rate increases imposed in that area.

Mr. Cook: It is not a major factor. The factor by which the growth planned by Lothian region increased rates is exactly 2½ per cent. of a total increase of 42½ pet cent. That shows the extent to which it was a major factor. I shall come back later to exactly what that growth was.
If the hon. Gentleman will allow me, may I first polish off my remarks on clause 13? The other reason why I find it objectionable is the totally outrageous sweep of discretion that it gives the Secretary of State. I noticed that when the right hon. Member for Orkney and Shetland (Mr. Grimond) made his speech he misquoted the conditions in clause 13. He said that the Secretary of State could invoke his powers under that clause on the basis of "such other criteria as were appropriate". The right hon. Gentleman had to correct himself. What clause l3 says is
such other criteria as he considers appropriate".
It would be entirely reasonable to say "other criteria as were appropriate", because that could be tested and challenged in the courts. However, by inserting his own no doubt complex and confused stream of consciousness into the process, the Secretary of State has made sure that no future court can peer into the way he was thinking and the kind of criteria that he considered appropriate.
What criteria will the Secretary of State consider appropriate? Will it be that there will be a new moon the next week? Will it be that the hon. Member for Edinburgh, South has made another speech attacking Marxists in the Lothian region? We do not know. The Bill does not tell us. The Secretary of State has just left the Chamber in case he might be tempted to tell us what he considers appropriate.
I wish to draw attention to one other power before moving to my general remarks—the power contained on page 24. It is a new power which has not been mentioned hitherto in the debate. I am not surprised. It is tucked away in a schedule headed "Minor and Consequential Amendments". However, within schedule 3 on minor and consequential amendments there is a whole new set of powers for the Secretary of State concerning what he can do with the money that he has docked from the offending local authority. According to paragraph 8, he can do one of two things. He can restore it to the local authority
if he considers that their subsequent conduct has been such as to merit such restoration.
Never in any Bill have I seen such vacuous, vague and flaccid terminology, giving such a wide and sweeping range of discretion to the Secretary of State. What will be the subsequent conduct that he considers to be such as to merit the restoration of the grant? Is it that an authority has stopped giving interviews to the press criticising him or, in the case of Dundee, that it has decided to drop its opposition to the Tenants' Rights Etc. (Scotland) Act? We do not know. We are not told in the schedule, and it would appear entirely proper for the Secretary of State to base his decisions on any of those examples. He can give the


money to other local, authorities "as he thinks fit" — again, untrammelled by any condition, any formula or any challenge in the courts, but simply "as he thinks fit".
This is arbitrary government with a vengeance. This is a new power that no previous Secretary of State has enjoyed. The right hon. Gentleman can single out particular local authorities and reward them with extra money, and he can penalise other local authorities for unspecified reasons.
The irony is that, as with so much Government legislation over the past year, this is legislation based on myths—the myths that public expenditure in Britain is too high and is increasing because of local authority expenditure. Our public expenditure level is now one of the lowest in Europe. In terms of the purchase of goods and services, public expenditure has fallen as a proportion of GDP over the last five years. It is totally untenable to argue that local authority expenditure has increased over the same period. If Conservative Members would only pause in the middle of their diatribes and look at the Government's White Paper on public expenditure, they would find that between 1974 and 1980 expenditure by local authorities in Scotland fell by 9 per cent., while expenditure by St. Andrew's House increased by 7·6 per cent. It is not local authorities that are putting up public expenditure. Local authorities have borne the brunt of cuts in public expenditure over the last six years.
In producing a Bill that imposes new sanctions and new penalties on local authorities, the Government are clearly trying to single out local authorities as a scapegoat for their difficulties, and they have managed it with considerable finesse. Conservative Members criticise local authorities for employing bureaucrats, but the irony is that the Secretary of State for Scotland employs virtually no one but bureaucrats. I do not criticise them for being bureaucrats. Bureaucrats have an important, vital job to do. By comparison, the local authorities employ a small proportion of bureaucrats. The great majority of their staff are policemen, firemen, teachers and social workers. The hon. Member for Edinburgh, South referred to the increase in staff in the Lothian region. The increase for the last 12 months is 589, which includes 86 policemen and firemen, 207 teachers and 218 social workers. They are not bureaucrats. The figures cannot be denied.
The Under-Secretary of State criticised the Lothian region for new growth in its last budget. One half of that new growth included a mere £1 million for the social work department, to provide more home helps to cater for the increasing number of elderly people in the Lothian region, to provide a laundry for incontinent people who live at home and to provide an alarm system for elderly people who live at home and who do not want to go into a sheltered housing scheme. That last provision will save public expenditure in the long run. If the councils in the Lothian region decide that that sort of expenditure is necessary for their community, they should be free to take that decision and be answerable ultimately only to the community that elects them. If we reach the stage where the Secretary of State is empowered to decide that Lothian region council has made the wrong decision or that the electors made the wrong decision in electing it, we are in danger of extinguishing local authority autonomy.
I regard that not simply as tragic but as dangerous, because local authorities are an important element of

democratic decision-making within our country and form part of the important system of checks and balances which is ultimately the only guarantee of personal liberty. We are dealing not simply with a technical change in the way in which the rating system works but with the fundamental issue of local democracy and the right of local communities to elect local people to reach their own decisions. That is why I think that the House should throw out the Bill rather than pass it as yet a further step on the road to dictatorship by parliamentary majority

Mr. Bill Walker: I welcome the opportunity to speak in this important debate, but I wish that we lived in a country in which a Bill of this sort was not required. I am saddened that we have to introduce a Bill of this nature. Why do we do it? We do it because if democracy is to survive in this country the relationship between local and national Government should and must be better.
The population at large know that the relationship between the Labour Government and local government was bad, and they know, too, that the relationship between this Government and local government is not good. The population at large wonder why and ask why. I hope that I can make a contribution and shed some light on some of the problem areas. Sadly, I believe that politicians in local government and in Parliament are frequently interested only in scoring political points. Often the view is taken that the end justifies the means.
This has been an interesting day for Scotland, because it has brought forward two patriots, one from either side of the House, and I do not think we should ignore that. The speech of my hon. Friend the Member for Glasgow, Hillhead (Mr. Galbraith) in Committee this morning and that of the hon. Member for Glasgow, Provan (Mr. Brown) were both good, and they were good contributions to democracy. They were important speeches, which should not be brushed aside humorously.
I believe that the hon. Member for Provan believes in democracy—and he is a patriot, which is important. It may not be fashionable in some quarters, but the public at large are looking for more people who are patriots—in this House and elsewhere. The hon. Member for Provan and I are rarely likely to agree on political issues, but I hope that he will agree that I frequently speak to Labour councillors and to Labour Members of Parliament. I listen to what they say, although I do not necessarily agree with them. I hope he will agree also that I am not gagged in Committee.
No one in the House or elsewhere denies that we have a world depression and that there has been a loss of markets, yet some of our wounds are self-inflicted—for example, savage rate increases. The taxpaying, ratepaying industrial and commercial firms, without exception, are looking for substantial reductions in local authority expenditure, particularly in revenue expenditure.
I hope that the Bill, particularly clauses 13 and 14, will reward the law-abiding councils, such as Tayside and Perth and Kinross, and I hope, too, that it will penalise the non-law-abiding councils. I draw attention to Dundee district council, in which I have an interest because part of my constituency falls within it. Sadly, the history of the city of Dundee is one of constantly inflicted damage. The individuals living there do damage to that city, and local politicians seem almost hell-bent on destruction. They


refuse to accept the law of the land, whether that law is passed by a Labour Government or by a Conservative one. That is not very clever, because in Dundee we are concerned with the creation of new jobs, and we cannot create new jobs if the image in the locality is damaging to their creation.
I agree that we must look carefully at the statutory obligations that we place on local authorities. We put statutory obligations on them and then we object when they bring manning levels up to what they regard as necessary to carry out those obligations. That is riot terribly clever, and it is something that we in the House should consider.
I should like to draw attention to the creation of nonessential jobs that do not arise from statutory obligations. I refer specifically to the activities of Dundee district council. I find it difficult to see how, in times of great economic pressure, it can justify a research officer. It may be that this research officer will help the lord provost or the leader of the administration to seek out new cities which, in the eyes of the political commissars there, would tie suitable for twinning, but perhaps if the council had had a research officer before it would not have carried out the most recent example of twinning.
In Dundee district it is common knowledge that the chief officials are not allowed to shed any labour, even if they consider it to be surplus. The council ignores the desire of the electorate to get value for its rates. There was me example of the Dundee Standard. The Dundee district council channelled substantial funds towards advertising in that newspaper. Sadly, in the eyes of some people, we have seen the demise of that paper, but that is not the view f the majority of Dundee citizens.
The controller of audit for local authority accounts, in reply to correspondence that he is having with me, says:
The Auditors do not now consider it necessary to pursue the question of duplicate advertising in the Dundee Standard since the point has been rendered academic by that paper's demise"—
this is the important point—
out they will be keeping a watching brief to raise the value for money issues again should there be any suggestion of the standard being revived and the practice of duplicate advertising resumed.
That is the kind of thing to which industrialists on Tayside and in Dundee object.
It is important that we recognise that today there are many people in local government who, sadly, feel that they are being got at that somehow they are the victims Of every politician who wants a cheap headline. People who work for local government should recognise, more than anyone else, that they do not generate the nation's wealth. They have to be paid for out of the areas in which the wealth is created. If we have people in jobs that we cannot afford, something will give eventually.
We also have to recognise the attitude to work of local government employees in some areas. There is not the incentive to do as well in local government as elsewhere. The rewards are not there as they are in other areas. We should recognise that. Coupled with that is the fact that a number of people who work in local government are determined to get the best out of the system as it exists. That includes taking days off for sickness, and so on, in order to decorate their homes.

Mr. Norman Hogg: This is a scurrilous attack on local employees. Unless the hon. Gentleman is to say who they are and what their practices are, it is unacceptable that he should make that kind of ignorant attack.

Mr. Walker: I am confident that anyone outside this House who works for local government and who listens to the debate or reads about it will be able to look around his office or department and say "He is the one that we are talking about." The people who work in local government will judge whether I speak the truth as I see it or whether the hon. Member for Dunbartonshire, East (Mr. Hogg) is again making a political point.
It is important that we do not condemn the majority, who are good workers and want to do their best but whose attitudes are very much influenced by those of the spongers and the scroungers. We all know that it is very difficult today to sack a public servant simply because he is not pulling his weight. I have some suggestions to make on how the Government and other people could look at this problem and deal with it, first in regard to overmanning and secondly in regard to incentives.
We should perhaps consider having a higher rate of income tax for those who work for national and local government, and a lower rate for those who work in manufacturing and commerce, which generate the nation's wealth. For example, if 75 per cent. of the employees in an organisation could be classified as being engaged in manufacturing or commerce or creating wealth, they would enjoy a lower rate of income tax. That would in some way compensate for the difference between job security and lack of job security.
Local authorities should get rid of their large architects' departments, quantity surveyors' departments and direct labour departments. They should, instead, put the work out on contract to the private sector at the keenest possible price.
I draw the attention of Labour Members to the achievements of Tayside region, which has reduced its work force, and thereby made a contribution to a reduction in revenue expenditure, in the year eliding July of this year. There has been a reduction of nearly 500 in staffing levels. If that can be achieved by one region, surely the example can be followed by others.
I hope that the Government will look carefully at revenue expenditure and use the powers in the Bill which are directed largely at revenue expenditure and stop the insane cutback that successive Governments have made in capital expenditure projects. The nation needs those projects as part of the infrastructure in the battle that we face in competing with other nations. The seeds that we sow will produce the harvest that we get. That was true of the previous Government, and it is true of this one.
That is why I am unhappy about the introduction of the Bill. I wish that we did not have to introduce a measure of this kind. I wish also that we had responsible authorities, and I am saddened that one of the irresponsible authorities is in my own constituency.

Mr. Norman Hogg: It is extremely difficult to maintain one's good temper and good humour when following a speech such as the one just made by the hon. Member for Perth and East Perthshire (Mr. Walker). Since I entered the House in May 1979 I have not previously heard such a speech. It was quite the most reactionary that I have heard here.
I am sorry that the speech was also irresponsible, although the hon. Member is fond of talking of responsibility and insisting that he is the custodian of true responsibility and that everyone else is in error. He would have made a splendid seventeenth century theologian. But his attacks on the Dundee district council and other local authorities have been scurrilous. I am sorry that I have to follow such a speech, because to some extent it has put me off my stroke.
It is interesting that as the day has been wearing on Conservative Members have started to apologise for the Bill. This morning, in the Scottish Grand Committee, they did not find it possible to support the Government with their votes, and tonight they are apologising for an important measure that is before the House. That is very significant. There is a very big difference between the Conservative Party's rhetoric at the last general election and the reality of what it does now that it is in power.
We remember all the slogans about Tory freedom—about how the energies of the people were to be released as a result of the great extension of freedom under the Tories. That is very different from what is being proposed in this measure and what has been brought before the House in recent months.
This morning, when the hon. Member for Glasgow, Hillhead (Mr. Galbraith) made his contribution in the Scottish Grand Committee, it was refreshing to hear a demand that the Government should keep their word and honour their commitment, for that is not what they have been doing since they came to office. It has been no surprise to those of us on the Labour Benches, because we did not expect anything different. What we have been having from the Government most of all is massive cuts in public expenditure.
Local authorities have had to carry the main burden. Recently, further cuts were announced in the mini-Budget. The Government are legislating in support of their dogma. They are not merely managing the economy but cutting the expenditure of various Departments and of local authorities. The Government legislated in support of their dogma in the Tenants' Rights, Etc. (Scotland) Act. The Bill represents an extension of that type of legislation.
The public expenditure cuts are having a cumulative impact on local authorities. We are beginning to see how those cuts will bite. Recently, I had an opportunity to discuss the situation with the provost of Cumbernauld, Bill Taylor, and his officers. I was disturbed by the problems faced even by a local authority of that size. I was told that it had overspent by 32 per cent. on comparative estimates—provided by the director of finance—for the period ended 31 October 1980. I was also told that part of the cost was due to under-budgeting by the previous SNP administration, which had sought to keep down rates during an election year. That local authority has no means of achieving the cuts demanded by the Government. It was £200,000 down before the elections. That is equivalent to 1½p on the rates.
That authority cannot make the cuts required. It faces high interest rates. At present, its loan charges amount to £300,000. The housing support grant has been reduced by £640,000. Such things are happening in local authorities. I have related the experience of one local authority in East Dunbartonshire.
The Government plan a wider attack. They wish to interfere directly in local authority expenditure. Governments do that, but this Government wish to extend their powers under clauses 13 and 23. Local authorities will no longer be able to determine their priorities. They will be subject to the Secretary of State's diktat and to his central bureaucracy. My hon. Friend the Member for Edinburgh, Central (Mr. Cook) pointed out that the Secretary of State employed only bureaucrats. He was right. I wish that people would recognise the services carried out by local authorities. The Secretary of State's bureaucrats will dictate to local authorities more and more. Irrespective of local need, the Government will dictate the position. Local councillors will no longer have the right to legislate for their areas without that legislation being subjected to the Secretary of State's approval.
Council committees will have to wait to see whether their plans have been given the Secretary of State's seal of good housekeeping. I am sorry that so many Conservative Members should have decided to support this measure, despite the fact that some have qualified that support with a degree of reluctance. They intend to go into the Lobby and to defend and support the Bill.
I am not sure what criteria the Secretary of State will use when determining whether an authority's expenditure is legitimate. I hope that the Under-Secretary will tell us what criteria the Secretary of State will apply when making such decisions. I fear that we shall hear only the expression of the Secretary of State's prejudices and paranoia about local authorities, such as Lothian regional council and Dundee district council. This measure was spawned by the prejudice and paranoia that he has displayed in the House month after month.
These questions must be answered. We must know what the criteria are to be. I do not know who will serve in Committee, but I am sure that Labour Members will press the Secretary of State on those criteria. I am sure that attempts will be made to table amendments to mitigate his powers. Those who believe that local government should be conducted against a background of maximum freedom will find this measure deeply offensive.
If the Bill is enacted, the Secretary of State will be given plenty of scope. It is sad that that should be so. I was amazed when I heard Conservative Members pleading for new ways in which to raise finance. The Layfield report has been issued. I should be interested to know what the Government think of it. I hope that the Government will tell us tonight whether they intend to do anything about any of its recommendations. I am sure that Conservative Members and some Opposition Members would welcome changes being made to the rating system.
When I re-read the Conservative manifesto this morning—something of which I do not make a habit—I noticed that there was no commitment to dispose of the rates, despite the remarks made by the right hon. Member for Orkney and Shetland (Mr. Grimond).
If the Bill is given a Second Reading, the House will damage the democratic structure of Scottish local government. If the House were to do that, it would approve of the onslaught on democratic institutions that has gone on since the Conservative Party came to power. The Bill will centralise power in the Secretary of State's hands. He has already demonstrated a blind adherence to Cabinet policy and a disregard for the interests of Scotland in favour of the well-being of the Conservative Party. That


does not serve the interests of local government. Those who are concerned about the future of local government will oppose the Bill.

Mr. Iain Sproat: The hon. Member or Dunbartonshire, East (Mr. Hogg) began his speech by raying that he was surprised that so many Conservative Members had had to apologise for the Bill. I certainly do not apologise for the Bill. I am equally certain that my hon. Friends did not apologise for the Bill. They were saying—the difference was distinct and clear to everybody on this side of the House—that they did not apologise for the Bill but that they were deeply sorry that the Secretary of State should feel the necessity to bring in such a Bill because a number of local authorities in Scotland had been behaving in a certain way. That is an important distinction that must be drawn.
I wish to direct a few brief remarks to part II of the Bill and to congratulate my right hon. Friend on doing something that should have been done long ago, namely, acquiring sufficient power to get a grip on local authority overspending. My constituents are fed up with paying, as taxpayers, for the spendthrift habits of certain other local authorities. I ant sure that the constituents of every other hon. Member feel the same, although Labour Members till not admit it.
Day after day we see examples of ridiculous overspending and waste. In recent months the worst examples f crazy spending by local authorities happen to have been i England: the £10,000-a-year dustmen, the £14,000-a-year janitor, the £500-a-week heating engineer—all draining the poor hard-pressed ratepayer.

Mr. George Robertson: Anomalies.

Mr. Sproat: It is no use the hon. Gentleman moaning about ratepayers having to pay for janitors at £14,000 a year. If he knew a few janitors in his constituency on £14,000 a year, he would get on to his local authority. if did not, the ratepayers certainly would.
Although such stories have not so far surfaced in Scotland, I dare say that it is possible to find examples that are just as appalling. We read in this morning's newspapers of two councils that are to pay on the rates for a "dancer in residence". What a time this is to employ a man on the rates to show people how to do ballet or Scottish country dancing!
I have no objection to the Scottish Arts Council helping no subsidise that sort of thing, if that is what it thinks is tie best way to spend its money, though I do not. I certainly should object as a ratepayer of Fife and Tayside to the idea that my rates should go towards paying the annual salary of a "dancer it residence". That is simply one example from this morning's newspapers.
We have already heard from my hon. Friend the Iv ember for Edinburgh, South (Mr. Ancram), who has done so much to bring the legendary activities of Lothian regional council to the attention of the ratepayers, of the it sane waste of. I think, £25,000 a year on a Socialist propaganda sheet, the Lothian Clarion. I wonder what is thought by the ratepayers in Lothian who do riot happen to be Socialists, or who are Labour Party supporters but not of the extreme variety that produce that newspaper, at out the £25,000 of their rates going on that publication.
My hon. Friend the Member for Perth and East Perthshire (Mr. Walker) gave the example of the Dundee Standard. What a ludicrous waste of ratepayers' money that is!
It cannot be said that there is no waste of ratepayers' money in Scotland when we can pluck from the air examples such as the Lothian Clarion, dancers in residence and a research officer fixing up for Dundee to be twinned with an Arab town. With all that sort of rubbish, it is indefensible to say that there is no waste by Scottish local authorities.

Mr. Ernie Ross: Mr. Ernie Ross (Dundee, West)rose——

Mr. Sproat: The waste must be stamped out, and I am glad that in the Bill my right hon. Friend the Secretary of State is taking steps to do it.
I now give way to the silent Member for Dundee, West (Mr. Ross).

Mr. Ross: Dundee district council does not employ a research officer at this time. The decision to twin with the city of Nablus was taken by the local authority, supported by two independent ratepayer members of the authority.

Mr. Sproat: I am delighted that the authority no longer employs a research officer. That is a sterling example of the excellent work done by my hon. Friend in rooting out abuses. The more he can root out, the better.
In the past 12 months there has been a cut of about 20,000 in the number of persons employed by local authorities in England and Wales. Some of our English colleagues may say that that is not enough, but at least it is a cut. The biggest and most shocking example of waste in Scotland is that, far from cutting by 20,000, we have increased the numbers by 4,000. That is the scandalous refusal to recognise the economic realities that my right hon. Friend has done so much to try to bring before local authorities. I hope that one of the most important results of the Bill will be that we can crack down on councils that deliberately—as in the case of Lothian—take on more staff at times of economic difficulty in order to bring about a confrontation with the Government.
The right hon. Member for Glasgow, Craigton (Mr. Millan) made a rather snide remark about Grampian region, a remark which I am sure will have caused great offence to my hon. Friends the Members for Aberdeenshire, East (Mr. McQuarrie), for Aberdeenshire, West (Mr. Fairgrieve), the Under-Secretary of State, and for Moray and Nairn (Mr. Pollock). Grampian has been the best housekeeper of all the regions in Scotland over the years. I recall the conversations that I had with the regional convener, Mr. "Sandy" Mutch, when the right hon. Member for Craigton was Secretary of State for Scotland. Mr. Mutch would say "We have this ludicrous new proposal from the Government, but it is our duty to obey them", and the region would do its best to implement Socialist policy. It ill becomes the right hon. Gentleman to start making attacks on Grampian.

Mr. George Robertson: My right hon. Friend's comment was that in the last round of rate increases the Central regional council—Labour-controlled—had an increase of 17·3 per cent., which was lower than that recorded in the Grampian region, at 18 per cent.

Mr. Sproat: That was not what the right hon. Gentleman said. He talked about the rate burden on individuals in Grampian, as the hon. Gentleman will find


in Hansard tomorrow. Of course, I accept that point, but what is irritating to us on the Conservative Benches is that the right hon. Gentleman says it in that snide, whining way of his—(Interruption.]—I challenge anybody to deny that that is a fair description of how he spoke this afternoon—without pointing out Grampian must bear almost alone the burden of the oil infrastructure, which is a massive burden on the rates. It has to bear that harsh burden in terms of roads, houses and schools, yet we receive little support from the rate support grant. Grampian is out of pocket by millions of pounds as a result.
My right hon. Friend said this afternoon that he would look closely at the needs of local authorities. I hope that he will look closely at Grampian's needs in connection with oil development, because the development of North Sea oil is a national necessity. Therefore, it should have national funding rather than rely so heavily on local funding.
The right hon. Member for Craigton said in vivid language that the Bill was a major attack on local democracy, and other Labour Members talked about cutting away the freedoms and principles on which local government is based. That is rubbish. As so often in politics, we find two excellent principles opposing one another. One is that we should maximise the freedoms given to local authorities. The other is that the Government have a duty to see that the taxpayer gets proper value for money. Those are both valid principles. It just happens that in the present case the one is vitiating the other. Certain authorities, such as the Lothian regional council and Dundee council, are abusing their freedom to such an extent that taxpayers elsewhere are having to fund their crazy Socialist schemes.
When those two principles come into conflict, my right hon. Friend is right to say that of course we want to maintain the proper freedoms of local authorities but that where they abuse them we must look to our duty to protect the taxpayer. That is precisely what he is doing, and no more. No local authority that keeps within the limits of normal expenditure will ever find itself in danger of being hit under the Bill.
For all those reasons, I strongly support my right hon. Friend.

Mr. Ernie Ross: I welcome the opportunity to make a few comments on the Bill and to correct one or two inaccuracies about my local authority.
It gives me no great pleasure to follow the hon. Member for Aberdeen, South (Mr. Sproat). One of the most obscene effects of the Bill will be that unemployment queues throughout the length and breadth of Scotland will necessarily grow. I am certain that in two or three months' time the hon. Gentleman will return to his favourite pastime of attacking those on social security who, because of the Bill, will be condemned to the dole queue for a considerable period. I find it unacceptable to listen to the hon. Gentleman when he addresses the House, because he never takes the opportunity to make it clear that those in the dole queues are not, never were and never will be social security scroungers.
Despite the hypocritical polemics extolling the virtues of local government that we have had from Conservative

Members, the Government's policies will inevitably lead to the destruction of meaningful local democracy. Certainly, nothing could be more accurate than that as regards Dundee. Everything that we are attempting to do through the Dundee district council was made clear prior to the May election. We spelt out clearly what we would do when we took power, and we had the overwhelming support of the people of the city. We also had one of the highest votes in the four major cities.
No one can argue that the Dundee district council was not democratically elected and that the ratepayers were not fully aware of the policies that we would pursue when we took control of the council—policies directly opposite to the policies pursued by the previous Tory-controlled council, which did nothing to help Dundee's image, employment, housing shortage or other problems affecting the ratepayers.

Mr. Bill Walker: Is the hon. Gentleman saying that because Dundee district council was democratically elected on the policies on which it campaigned, it can do as it wishes? If so, he must accept that the national Government, who fund two-thirds of the expenditure and were also elected on their policies, can implement their policies, because they hold the purse strings.

Mr. Ross: It is for the national Government to decide what support they will give to the various local authorities. The Bill seeks to prevent local authorities which disagree with the allocation from seeking to raise revenues legitimately by increasing rates. The Bill sets out to deny that right to the Dundee district council and other local authorities which are not prepared to accept the Bill and the policies pursued by the Government.
The myth that cuts are necessary to help to restore the economy and are in a sense a patriotic duty has been well and truly hammered home by the media and by Conservative Members, but no one standing in any dole queue in Scotland would agree with that now.

Mr. Peter Fraser: Given the hon. Gentleman's support for the Labour-controlled Dundee district council, will he make it clear whether he supports the council's intention to raise rents in the city by 200 per cent. in the next financial year?

Mr. Ross: I shall come to that point later. I support my colleagues on the Dundee district council in everything that they do. I am prepared to say that here or on any other public platform.
Conservative Members have not commented on the pressures on local authorities because of the massive interest debt that they have to pay. The Bill does not seek to alleviate that interest debt. The policy of selling council houses can only add to that debt and make it more difficult for local authorities to make both ends meet. I am not an expert on local rates. Therefore, I should like to quote the comments of the treasurer of the Dundee district council when he addressed the local branch of NALGO recently. He said:
The situation facing Dundee District Council was that because of Government restrictions on public expenditure at the present time and, in particular, its attacks on council housing and council tenants, the present Labour Administration must consider a variety of horrifying alternatives. One of these alternatives was the possibility that 2,000 of the council's 3,000 employees were facing the prospect of redundancy within the next few months. In order to stand still the District Council was faced, through


Government cutbacks in expenditure, the emptying of reserves by the previous Tory Administration and inflation in general, with finding £11 million more Man last year from local sources.
As Councils only have three real sources of income and Government grants were being slashed almost on a weekly basis, the only alternatives, in order to maintain services at their present level, were increasing council house rents or rates. Even if council house rents were raised the £3 per week the Government was demanding, a rates increase would still be required, and council tenants would be faced with an increase in rents and rates of something like £4 per weak. The Labour Administration regarded this as completely unacceptable and yet another symbol of the Tory Government attacks on working people and their families. Dundee's rents were already above the Scottish average.
He went on to make it clear that
the Trade Union representatives would be involved in consultation with the Administiation at all times and in a spirit of co-operation he was sure ant they could together overcome tie difficulties which faced the council, its employees and the general public.
It is in that spirit that I support my local authority colleagues in their effort to offset the worst examples of Government policies.
I should like to comment on some of the speeches made by other hon. Members. I apologise for not being present when the hon. Member for South Angus (Mr. Fraser) made his speech. Unfortunately, I had to leave the Chamber. However, I understand that the hon. Gentleman referred to the public comments made by my hon. Friend tie Member for Caithness and Sutherland (Mr. Maclennan) in his attack in the local media on the Dundee district council. No one in Dundee would accept D. C. Thompson as an unbiased or objective observer of local politics or anything else in this country. We regret that my hon. Friend the Member for Caithness and Sutherland did not feel it necessary to inform his colleagues of his intention. It is up to him whet her he supports us, but when he goes to the organs of D. C. Thompson to attack us we find it unacceptable and a matter that he must justify to his local party.
The hon. Member for Perth and East Perthshire (Mr. Walker) said that the Dundee district council was hell-bent on destruction, with the creation of new jobs being ruined by the image of the locality. He referred also to the research officer that we intended to appoint to assist the local authority with its responsibilities. He also referred to the local authority advertising in the Dundee Standard. I here is a good possibility that the Dundee Standard will recommence publication very shortly. The hon. Gentleman can then pursue his comments with the Ombudsntian.
On 23 October the hon. Gentleman, with his hon. Friend the Member for South Angus, attended a one-day conference in Dundee organised by the Dundee district council. The one comment teat was made time and again by those who took part in the conference, the one comment that came back from every seminar that was organised in an attempt to attract industry, was that the lack of o infrastructure held back Dundee's ability to attract industry. The one comment made time and again was that the main responsibility lay with the way that the media had failed to give any balance d coverage of what was happening in Dundee and simply ran scare stories that tended to worry people from time to time.
An attack on workers in Dundee was made in the Scottish Grand Committee. The Dundee and Tayside chamber of commerce has trade it clear that the type of ill-informed and irrational comment made by the hon.

Member for Perth and East Perthshire has done more damage to Dundee's image than has anything else. The hon. Member forgot to say that Dundee district council has appointed a sports supremo and has lowered its charges for use of the leisure centre. It has done that because of the need and because of the present Government's policy. It has taken that action to ensure that the unemployed do something instead of hanging about and becoming involved in activities that allow people to suggest that they are having holidays in the Bahamas or are social security scroungers.
Comments have been made about the Tayside regional council. In last Thursday's article "Man about the Town House" in the Evening Telegraph and Post, the convener of the Tayside regional roads department is quoted as saying:
There has been a virtual ban on staff replacements and this has left 48 jobs unfilled. That has been adversely affecting efficiency because there has been a staff imbalance in that department. A close look at the situation has shown that of the 48 unfilled jobs 29 can be removed from the establishment permanently. This has been agreed. What happens next is that some of the remaining 19 jobs will be filled to correct the imbalance.
I place beside that quote a reply that I received from the Under-Secretary of State, who said on 13 November 1980 that 12,916 young people under 18 who had not entered employment since leaving school were registered as unemployed in. Scotland. The corresponding figure for Dundee was 637. He said that the number of males registered for more than one year as unemployed in Tayside was 2,774. At least 19 people have been registered at the employment exchange for at least a year because of the policies adopted by Tayside regional council. We do not accept such policies.
I refer Government Members to the decision by Dundee district council to create 90 jobs for young people to ensure that they are not committed to the dole queues as Government policies dictate. I shall vote against the Bill. It does nothing for Scotland. It does nothing for Dundee. It does nothing for the unemployed. Government Members would do well to remember that the Bill will create further argument and further social and class divisions. At the end of the day, Goverment Members will be rewarded through the ballot box by their removal. We shall get rid of the Bill, just as we shall get rid of the Conservative Government.

Mr. Donald Dewar: I read a preview of this week in Parliament in the Scottish press; which described the Bill that we are discussing as "tedious". I do not know whether it is tedious, but it is complicated. In order to understand it, one must refer to previous legislation and put together a kaleidoscope. The Bill raises a general principle and defines the differences of approach to local government democracy.
I declare a non-interest. Occasionally I visit the Dundee district and the Lothian region, but I represent neither. My interest in the Bill is that it will affect not only contentious local authorities. The hon. Member for Aberdeen, South (Mr. Sproat) referred to the Lothian legends that were put about by the hon. Member for Edinburgh, South (Mr. Ancram). I agree that the Lothian region's reputation is a legend, and probably a Tory myth. It does not bear much


relation to reality. I congratulate the hon. Member for Aberdeen, South on being careful with words for once and on getting their meaning more or less right.
The legislation will affect local authorities throughout Scotland. It will affect Strathclyde and Glasgow district and others. It deals with the nature of local democracy and the rights of local authorities to do their own housekeeping, to establish their own priorities and to keep them. It deals with the ability of local authorities to represent fairly and faithfully to the electorate the remit given at the ballot box.
When one reads the cold and dispassionate prose of a Bill, one is often left wondering what it means in practice. We must know more than that which is interpreted by a person of common sense and good will. We must know what Secretaries of State for Scotland, particularly Conservative Secretaries of State, will do in practice when they operate the measures in the Bill. Having listened with care to the Secretary of State, I am still unclear about the exact impact of some of the measures, particularly clauses 13 and 14 and later clauses dealing with local government structure. We feel that we are facing something that is either unnecessary—which I do not really believe, although I should like to—or distinctly sinister. That fear is shared in responsible local government circles. The feeling is extremely dangerous in itself.
The Bill contains such phrases as "excessive and unreasonable expenditure". One is entitled to ask what is "excessive and unreasonable". The difference between the new formula and section 5 of the 1966 Act is the point in the spending process at which the Secretary of State might intervene. Under the new legislation, that can be done at the point when estimates are before the local authority rather than waiting to see the ultimate outturn.
The Under-Secretary of State, to his credit, is always competent on details. I am sure that he has a sound knowledge of what has happened to local authority expenditure in the last three or four years. I repeat that I should like him to consider whether what has happened in Lothian or in any other local authority over the past four years has justified the activation of clause 13 at the estimate stage on the ground that the proposed expenditure was "excessive and unreasonable". If he says that that procedure will not be activated, as happened with the 1966 machinery, we shall at least acquire some understanding, though perhaps in a negative way, of the Government's intentions. If he describes circumstances in which it will be activated, he will provide an interesting guideline by which to evaluate the proposals.
Let us look at the bland statement in the explanatory and financial memorandum. It merely says that clause 13
extends the Secretary of State's powers".
That is no help in trying to understand the Government's intention. The Secretary of State is a reasonable man, as we all know. That is his constant pose. He agrees with almost any proposition that is put to him, until he is called upon to take action. I want to know how he will interpret the measure. Perhaps his surrogate, the Under-Secretary, can shed some light on the matter.
I do not believe that this measure has been introduced as some sort of legislative lumber. Surely we are not to be put through an exhausting Committee stage—I can promise the House that it will be exhausting—purely and simply to tinker with the fine print of a legislative

enactment that, since 1948, has never been used by Secretaries of State of either party. That would be a pathetic situation, and, to be fair to the Government, I do not think that that is the case. The legislation must mean something, and we are entitled to know what it does mean.
The hon. Member for Edinburgh, South, in his somewhat intemperate but typical attacks on his local authority, made clear that he thought that its actions were excessive and unreasonable. Perhaps the Under-Secretary will tell us whether this year, for example, he would have used the new machinery and, if so, what the effect would have been on the expenditure of that local authority.
I have seen some minutes of a meeting that took place on 17 October 1980 between the Secretary of State and the COSLA finance committee. Clause 13 was discussed at the meeting. The minute said—I assume that it was an agreed minute:
Spending performance relative to the guidelines would not be the sole determinant when the Secretary of State considered the use of his powers to reduce grants. The Secretary of State would also have regard to trends in the volume of local authorities' expenditure and other relevant considerations.
It was put to me very forcefully by senior local government representatives that they had pressed hard for a definition of those "other relevant considerations" but that they ended up none the wiser. I hope that we shall be given some information by the Under-Secretary before tonight's long watch is over.
I share the genuine concern that exists, as I think the Minister will accept, about the predicament of local authorities in Scotland. If my suspicions about the Bill's importance are justified, the Bill is clearly another "cabin'd, cribb'd, confin'd" threatening piece of legislation, amounting to a major attack on the freedom and room for manoeuvre of Scottish local authorities.
Government policy is forcing up rates inexorably and dramatically. In Strathclyde, which is by far the largest local authority in Scotland, the shortfall in cash limits was about 5 per cent. That authority was given certain cash limits, although the calculation was made on the likely outturn of wage increases and prices, and those cash limits turned out to be far too conservative. If one takes 1 per cent. shortfall as representing 2p in the Strathclyde rate, the shortfall will amount to a rate increase of nearly 20 per cent. for the coming year before anything else is included. That has been enforced by Government policy. Strathclyde is left with a deficit of about £30 million, which has to be funded initially out of the new rate.
If one assumes that in the coming year cash limits will be calculated on an estimate of pay increases of 6 per cent. and price increases of 11 per cent., it will be seen that there will be a cumulative process, which will leave local authorities in an extremely unpleasant and unsound financial position, through no fault of their own but entirely due to the guidelines being enforced by the Government.
That is the first part of the problem. The Government are deliberately forcing up rates by substantial amounts. Also, as we all know, they are attempting to force authorities to cut the services that they are providing for their areas. If a local authority wishes to manoeuvre, as I believe is its democratic right, and tries to reduce the impact on the services it provides by raising rates, it will be caught under clauses 13 and 14.
It is a serious situation. No doubt the Secretary of State will say that in real terms the rate support grant during the


coming year is likely to fall by only 3 per cent. But it is much more than 3 per cent. A region such as Strathclyde or any other major local authority has an immense number of statutory obligations that must be met.
Those obligations include the pupil-teacher ratio, the lire services and the sewerage services. That 3 per cent. will inevitably have a heavy impact on the limited areas of discretionary services.
I have heard it suggested by responsible local authority officials and elected members that the impact on discretionary services could be as much as 30 per cent. Even if one says 3 per cent., it will not end up as 3 per cent. There was supposed to be a fall of 2 per cent. last year in the value of the rate support grant, but it ended up as a fall of 7 per cent. once the cash limits had been involved. If one takes the same sort of ratio, that 3 per cent. may become 11 per cent., and its impact upon discretionary services such as the home help service and nursery school places will be nothing short of catastrophic.
It is not irresponsible for an elected local authority to say "We would like to raise the rates to a limited extent hi an effort to try to preserve humane and decent services." After all, the local authorities will eventually take the consequences at the ballot box. Yet, if they say that, they will be immediately clobbered by the Government in respect of next year's rate support grant. That is a thoroughly bad situation for the whole structure and credibility of local democracy in Scotland.
The situation is infinitely worse with regard to housing authorities. My right hon. Friend the Member for Glasgow, Craigton (Mr. Milian) quoted the alarming—that is not an overstatement—figures for the housing support grant and said how that would tumble wider the Government's present plans at a time when, at lest in comparative terms, more and more is being done for those who are holders of mortgages.
As someone who used to practise law and is still in touch with those who do, I should point out that the proof of the pudding is the practical advice that men of business give their clients. If someone comes into a law office in Scotland at present and discusses his financial situation, he will be told that the best legal advice is "Get the biggest possible mortgage you can, because it is such a bargain, given the tax concessions that are attendant upon it." Someone who earns a substantial middle-class salary and who has a mortgage of only £2,000 or £3,000 is a financial mug. He is plain daft, and will be told so by his professional advisers. At the end of the day, that makes the point as dramatically and Practically as needs be.
Although the housing support grant is being cut by 10 per cent., the situation is much worse than that, because Government policy will deliberately force up council house rents by up to 40 per cent. I represent a constituency in which there are 26,000 council houses. A lot of those people are now in genuine hardship because of the general impact of the Government's economic policies and, to be fair, the general recession that is affecting the industrial world. If council house rents in Scotland are forced up from £5·83 to £8 a week, as is contemplated, the impact will be considerable. Of the 10,300 householders in the Drumchapel scheme, about 25 per cent. are currently receiving rent rebate and another 1,098 are paying their rent direct. It is being deducted direct from benefit by the local authority, in consultation with the DHSS. One possible result of forcing up rents in the way that has been suggested is the ludicrous proposition that more and more

people will have to get rebates. It is not a practical social policy to say in defence of unreasonable limits that 43 per cent. of the population is so poor that it is not being asked to pay the whole amount in any event.
Where does that 43 per cent. go? If wages are held down to 6 per cent. and inflation to 15 per cent., and if council house rates are pushed up by 40 per cent., we shall end up with 80 per cent., or some such figure, in areas such as mine receiving a rebate. As a result, the whole system will be reduced to an unjust farce. More importantly, a lot of people in my area—perhaps because of bad take-up, or because they are on the margin—will have to bear this increase directly, arid they will quite properly resent that.
I am not one of those who believe that one can have an indefinite freeze on house rents or that house rents should in some way never reflect general inflation trends. However, at a time of economic recession I object to forcing up artificially the rent levels in council housing by a factor of three, four, five or six times what the Government are asking in terms of pay rates and several times the going inflation rate. It makes no sense whatsoever. It will breed frustration, dissent and genuine and well-justified anger in constituencies such as mine.
At the same time as the Government are doing that, they are cutting back on the capital allocation that will be available to local authorities. One may visit an area such as Drumchapel, or Garscadden, at the bottom end of my constituency, or Garscube Netherton, and sit in a house that was built in the early 1930s and has never been rewired since then. If the local authority representative says "I know that it is dangerous. I know that the plugs are overheating and that there have been many fires in the scheme. But I am awfully sorry, we have no money to rewire. And, by the way, the Government are asking us to raise your rent by 40 per cent. for this totally unsatisfactory house", that is a recipe, again, for something positively explosive.
It is not just a "Catch 22" situation for the local authorities; it is "Catch 22" squared. It is a thoroughly unrealistic position into which to place elected local representatives. It is a squalid travesty of social justice. It is positively wrong—I use these words with care—and bordering on evil to say, as the Government are now saying, that we should link the capital available for housing inprovements to the level of rents.
Housing capital should clearly be a matter of need. We may not be able to satisfy the need as generously as we want because of general financial privation and lack of public finance. We all accept those realities. But to say that if we do riot force up council house rents to a predetermined level that the Government want we shall have less money for rehabilitation, rewiring, and tenants' grants is basically an evil concept and one that should be thoroughly rejected.
There is far too much in the Bill that smacks of centralism of the worst sort, but it also smacks of a total insensitivity to the realities of life in housing schemes, certainly in industrial central Scotland, part of which I represent and in which I operate.
The Bill is fundamentally wrong. Therefore, it cannot be put right in Committee. That is why I shall vote against it tonight and why I shall be right to do so.

Mr. Albert McQuarrie: In following the speech of the hon. Member for Glasgow, Garscadden (Mr. Dewar), one has the impression, as has been so often the case this evening, that we are discussing not the Local Government (Miscellaneous Provisions) (Scotland) Bill but a housing and rents attack Bill for Opposition Members. In fact, this is a small Bill which
makes a number of changes to existing legislation relating to financial and other matters concerning local government.
It also
provides for improvements in the valuation and rating system.
It
provides for changes in the Secretary of State's powers to reduce rate support grants".
In that connection, the hon. Member for Garscadden said that clause 13 stated only that it extended the Secretary of State's powers—full stop. What the hon. Member did not read, and what I would have expected him to be doing anyway, with his legal mind, was reading the small print, which says that clause 13 not only extends the Secretary of State's powers but gives the Secretary of State
powers to reduce any element of rate support grant payable to a local authority where he is satisfied that the authority's estimated expenditure is excessive and unreasonable.
That is the important factor in clause 13. Concerning the Secretary of State's powers, that is the factor in which we are interested.
However, the Bill involves a wide range of changes. There are 33 clauses and four schedules. Many of the clauses are minor clauses and certainly not totally committed to the RSG or to rent increases, as we have heard from Opposition Members.
In the limited time available to me, I should like to comment on the clauses that cause me concern. Clause 6 empowers a rating authority to grant a rates remission in respect of land and heritages unoccupied and unfurnished for three months. I have no objection to such a remission being granted where there are genuine reasons for the land and heritages remaining unoccupied. However, properties are often held in that state by their owners for one simple reason—greed. The owners wish to obtain a greater rent, and it would be wrong if the Bill were to entitle them to a remission of rates when they are not making the property properly available.

Mr. Rifkind: I think that my hon. Friend may have misread the clause. The law presently provides that the three months during which property has been unoccupied must be in one financial year if it is to secure a rates remission. The Bill simply means that the three months can be spread over two financial years. It is a tidying-up procedure of which I am sure my hon. Friend will approve.

Mr. McQuarrie: I accept my hon. Friend's explanation. In my local authority experience, however, I have encountered such cases as this. I hope that the Bill will not enable a person who has property empty purely for the purpose of seeking a higher rent to obtain a rates remission.
Clause 7 causes me concern because it changes the arrangements by which householders can pay their rates by instalments, replacing the prescribed sum by one of £20. It also gives a local authority power to fix such lesser figure as it may think appropriate. This may not seem a great deal of money to most people, but it is to elderly persons who live in properties in Scotland with low

rateable values. It will cause these people worry if the local authorities fix the figure at £20 and if they are therefore required to pay their rates in one fell swoop instead of the weekly instalments to which they are accustomed. I hope that the local authorities will think seriously before fixing the figure at £20 or even at a lesser amount.
Clause 13 has been the subject of comment from both sides. It covers rate support grant. It could be unlucky for some, to echo the call in the bingo halls, and justifiably so. In spite of what Labour Members have said, a number of local authorities in Scotland have simply increased the domestic rate year after year to finance grandiose schemes, which are of no benefit to ratepayers, such as the construction of huge edifices to house the bureaucrats and their massive empires that have been created over the years.
I am sorry that no part of the Bill in any way abolishes the domestic rate. If it did, we might be able to rid our local authorities of the problem of a continually increasing domestic rate. My party's manifesto in 1974—the hon. Member for Dunbartonshire, East (Mr. Hogg) referred to it—promised that the domestic rate would be replaced with a new tax based on ability to pay. I realise that my Government are not accountable for that manifesto, but the abolition of the domestic rate is a must if the never-ending spiral is to end.
What is the point of reducing the rate support grant if the authority is to retain the right to increase the rates, penalise ratepayers and thereby obtain the money denied it by the Government? That is what will happen with local authorities that refuse to remain within the cash limits. If rating authorities are to be controlled and compelled to implement the Bill, further provision should be made to safeguard ratepayers from blatant disregard by the authorities of strict controls on spending.
I support my hon. Friend the Member for Aberdeen, South (Mr. Sproat), who spoke in praise of the Grampian regional council and the way that it had considered the rate support grant and operated its rating powers. That applies also to my district council of Banff and Buchan and to the district council of my hon. Friend the Member for Moray and Nairn (Mr. Pollock). Those district councils, and the Grampian region itself, have looked after the interests of the ratepayers. If local authorities continually resist the overtures of the Government to impose a realistic rate, we must give serious consideration to a total reform of the dometic rate to bring it under the control of the Government. That would be a more satisfactory position for the electors.
I am delighted to note that the Bill abolishes the Scottish River Pollution Advisory Committee.— [Interruption.] The sections applying to the appointment, constitution and function of that body under the Rivers (Prevention of Pollution) (Scotland) Act 1951 will cease to have effect. I am sorry that the Bill does not propose to abolish that Act—[Interruption.] The Act has been used illegally for many years by river bailiffs to hound farmers—[Interruption.]

Mr. Deputy Speaker (Mr. Bernard Weatherill): Order. I have to listen very carefully in a Scottish debate, and I cannot hear if hon. Members continue to interrupt.

Mr. McQuarrie: Because Opposition Members live in towns, they have never heard of river pollution on farms. As I said, the Act has been used illegally for many years


by river bailiffs to hound farmers in Scotland and to penalise them when they have protected rivers on their farmlands from erosion. The bailiffs wasted the time of the courts by presenting prosecutions and then withdrawing them after the farmers had been involved in considerable costs in preparing a defence against this needless, action. Perhaps the Secretary of State will bear that point in mind when he is considering amendments to the Bill.
Schedule 2 relaxes the control over local and other authorities. I refer especially to the items connected with section 24 of the Burial Grounds (Scotland) Act 1855. It is proposed to remove an authority's requirement to have its scale of fees for burials approved by a sheriff. I do not think that that alteration is necessary, because the existing section of the Act is satisfactory. It provides a safeguard for the ratepayer. Far too many local authorities are charging extortionate rates for burials in an effort to make more use of cremations. The curb on the authorities' powers through requiring them to seek the approval of a sheriff for any proposed increase in the charges should re main in the Act. [Interruption.] I should hate to bury the hon. Member for Stirling, Falkirk and Grangemouth (Mr. E wing).
Opposition Members will be interested to know that I have examined all the clauses of the Bill and not simply the housing support provision. I hear someone saying that it is a burning issue. Yes, it is a burning issue, but it is not the whole Bill. With regard to the Cremation Act 1902, I am sorry to say that no provision has been made in the Bill to amend the charges for medical certificates before a cremation can take place. I accept that it is right that two doctors should certify a death before cremation takes place, but I can see no reason why the family doctor, who is already paid by the National Health Service, or the doctor in the hospital who initially certified a person as de id should be paid an additional fee for signing the death certificate, especially as the cost of both of these certificates has to be met by the deceased's relatives. [Interruption.] It may be that some Labour Members are deceased in their places and are not taking in these important points.

Mr. Deputy Speaker: It does not sound as if they are.

McQuarrie: Perhaps they look it, Mr Deputy Speaker. I am sure that my hon. Friend the Under-Secretary of State will want to consider these matters when the Bill has been finalised.
I turn, finally, to clause 11, which seeks to diminish the powers of sheriffs' officers
to poind, seize, remove or secure property belonging to … the debtor".
The actions which all hon. Members will be aware of in relation to the recovery of debt by the seizure of goods by sheriffs' officers are some of the most degrading incidents in modern society. The terror and shame that are inflicted on some debtors should not be tolerated in any decent society.
The Bill will go a long way to improve the present situation, but I should have liked to see additional clauses writ en into it to protect the citizen from the sudden dawn raids which are regularly reported in the press, too often with a heavy-handedness and a total disregard for the feelings and circumstances of those concerned, many of whom have been forced into debt through no fault of their own.
I welcome the elements of the Bill. I hope that my right hon. Friend the Secretary of State will take due cognisance of the serious matters that I have raised—they may have seemed flippant to Labour Members—and that require the consideration of the House before the Bill is given a Third Reading. I welcome it and I shall be supporting it.

Mr. John Home Robertson: I hope that the hon. Member for Aberdeenshire, East (Mr. McQuarrie) will forgive me if I do not take up his remarks on cremation and river pollution. I want to dwell on other, perhaps more relevant, and perhaps more important, areas of the Bill.
I suppose that it was inevitable that the Government would produce a Local Government (Scotland) Bill sooner or later, in spite of the unhappy experience of a Conservative Government's earlier foray into that area when they gave the people of Scotland the doubtful benefits of regionalisation. I am afraid that the people of Scotland will be rather disappointed by the miscellaneous provisions that the Government have laid before the House. They are a pitifully miscellaneous set of provisions in many respects.
The Government came to power with a mandate to roll back the power of Whitehall and to boost the influence of local institutions. In fact, they have chosen to do exactly the opposite. If anyone has any doubt on that score, I advise him to look at the cover of the Bill, where, for example, it is stated that part II, which deals with rate support grant,
adds to existing powers possessed by the Secretary of State.
It adds that clause 13
extends the Secretary of State's powers to reduce any element of rate support grant".
We are seeing no reduction in Government control over local authorities in the Bill. One might have hoped that such a radical Government as this would consider the possibility of doing something about domestic rating. A number of hon. Members, especially Conservative Members, have referred to the undesirable aspects of the rating system. I feel strongly about it. It is one of the most unfair and arbitrary forms of revenue raising known to man. It is disappointing that the Government are doing nothing on that front.
One might have expected such a radical Government as this to consider revising the two-tier system of local authorities. I understand that that issue has been left to the committee that is chaired by my distinguished constituent, Mr. Anthony Stodart, who, I gather from the Secretary of State, will report in January, by which time the Bill will be in Committee and there will be little likelihood of the Committee considering that aspect of local government.
Parts I and II cover rating and the rate support grant system. In commenting on the provisions dealing with the rating system, it should be emphasised that they do not reduce the burden on Scottish ratepayers by one penny. They merely bring the whole convoluted system into line with the procedures in England and Wales. To that extent, there is no joy in them for those of us who would like to see a radical review of the local government finance system.
The Secretary of State's claim that he is the ratepayers' friend is wearing thin. People know that it is the right hon. Gentleman, rather than local authorities, who is responsible for the rates explosion over the past two years.


My right hon. Friend the Member for Glasgow, Craigton (Mr. Millan) gave the figures for rate increases over the past year. He said that rates in Lothian region and Strathclydes had increased by 41·5 per cent. and in the Borders region by 37 per cent. He also mentioned other regional councils. Virtually all the increases in rates are a direct result of the Government's fiddling with the rate support grant and its relevant expenditure.
It should again be emphasised and re-emphasised that it is the Government's fault, and not predominantly the fault of local authorities, that the explosion in rating has taken place.
The Secretary of State's vendetta against Lothian regional council has already been touched on. It is a squalid and arbitrary confrontation, set up by the Government for purely political purposes. I have two comments to make. The first is that Lothian region is correct, and remains so, in making a stand against the cuts in education, social services, home helps and so on that the Secretary of State is asking it to impose. The second is that it might have been politically misguided in taking its excellent idealism just that little bit further and budgeting for growth, because that decision has enabled this opportunist Government and Secretary of State for Scotland to give the impression to the people of Lothian and Scotland generally that the whole of Lothian's huge rate rise is attributable to the growth element in the budget.
Nothing could be further from the truth. The Secretary of State knows as well as we all do that the growth element in Lothian region's budget accounts for only a few pence in the rates. It is at most 3 per cent. The biggest portion of the rate increase is attributable to the activities of the Secretary of State and his tampering and tinkering with the rate support grant.
In spite of those facts, the Government are using the confrontation with Lothian as a pretext to bring in unprecedented and draconian new measures that will enable this and future Governments to make savage and direct attacks on the activities of individual local authorities throughout the country.
It is worth dwelling on the fact that not only Lothian and Strathclyde have had high rate increases. The Borders region, controlled by the Conservatives and some of their friends, has also had a massive rate increase. In that case it was entirely the result of the Secretary of State's tampering with the rate support grant. It is a fine spectacle these days to see the so-called Marxists of Lothian regional council standing shoulder to shoulder with the backwoodsmen of the Borders region at the Convention of Scottish Local Authorities when they protest at the fact that the Government are compelling them to cut their essential services and continue to fleece their ratepayers.
I wish to deal now with housing and the housing support grant. As we know, the Government are steadily increasing the proportion of the housing revenue account of local authorities that comes from rents. In 1979–80 it was 49 per cent. of the housing revenue account. It was 50 per cent. in 1980–81 and it will increase to 63 per cent. in 1981–82. Where is that money coming from?
Many of us had hoped that if local authority tenants had to pay more in rent at least they would derive some benefit from reductions in their rates. But no, the rate fund contribution to the housing revenue account is to remain static at about 16 per cent. throughout this period. The

only beneficiary of this rejigging of funds for the housing revenue account will be the Chancellor of the Exchequer and, through him, those privileged few who have benefited from the Government's tax cuts. Their contribution to the housing revenue account will drop from 35 to 34 to 21 per cent. over the three years in question. If the Government intend to keep to their expenditure plans up, to 1984, rents will continue to go up and rates will continue to go up—I am glad that the Under-Secretary of State does not dissent—while the better-off taxpayers will benefit.
I spoke earlier about massive increases in rents. In the East Lothian district, in my constituency, the council found it necessary to put up rents last April by 17 per cent., or 81p. The Government say that that increase was wickedly irresponsible and that rents should have gone up by 30 per cent., or £1·40 a week. That is a directive from a Government who claim that their prime aim is to reduce inflation. Yet they are compelling local authorities to put up rates by 30 per cent., and, as we understand, they want them to raise rates by 40 per cent.—over £2 a week—next year. The Government are guilty of a number of dishonest tactics, but the practice of compelling local authorities to do the Chancellor's dirty work has gone beyond a joke. Tenants and ratepayers are paying more, and only supertax-payers are paying less.
The Bill will penalise the more responsible local authorities. Councils which manage their affairs properly and provide decent services, with reasonable rents and reasonable charges, such as the East Lothian council in my constituency, will have their Government subsidies cut, which will mean that the ratepayers will have to pay more. Other authorities with high rents and high charges—on which the Government seem to be keen—and councils which provide rock-bottom services will do very well out of the scheme. What is more, there will be no penalties under the Bill for local authorities that underspend and provide substandard services. That is deplorable.
The Prime Minister talks about incentives and enterprise, but her Secretary of State for Scotland has produced a ludicrous rag-bag of counter-incentives, which is a charter for Tory joy-riders, who do not give a damn about the standard of services that are provided in their areas. Those are the so-called responsible local authorities that the Government want to encourage.
A great chunk of the Bill deals with the powers of the Secretary of State over unreasonable councils. It is for him to define what is an unreasonable council, but who can protect us from unreasonable Secretaries of State? The Secretary of State is unrepresentative, and if we did not know that before we certainly discovered it this morning, when he could not find any hon. Member to vote for his wretched colleges of education measures.
I am under pressure to get a move on, despite the fact that I have been present in the Chamber throughout the debate.
This is a deplorable Bill, which will do nothing but damage to local authorities and will do nothing to roll back the influence of the Government. I sincerely hope that the House will reject it.

Mr. Deputy Speaker: I understand that the winding-up speeches are timed to begin at 9.20 pm, and I should like to be able to call two hon. Members before then.

Mr. Alex Pollock: I think it was my right hon. Friend the Secretary of State who, in opening the debate., stressed that the main thrust of the Bill was a med at local authorities likely to ignore economic realities. In that sense, I think that I can fairly say that the local authorities within my own constituency need have little to fear from his measures, since they have a most creditable record in that field, partly because of the traditions of thrift and canniness in the North-East and partly because of the excellence of the representatives on those local councils.
I wish merely to make two brief comments in relation to part IV of the Bill dealing with miscellanous matters. Clause 22 is headed
Relaxation of control over local authorities
and refers in turn to schedule 2, which includes a commendable list of subjects—which have been touched on in part by my hon. Friend the Member for Aberdeenshire, East (Mr. McQuarrie)—from burial grounds through cremation to methylated spirits, over all of which the iron fist of the Government is to be relaxed. That schedule extends to nearly nine pages, and inasmuch as we need legislation to reduce legislation that is certainly not one page too many. But what concerns me is that there are two measures which are lot in the Bill which might usefully have been considered by the House when looking at it in Committee. One has been touched on already by my hon. Friend the Member for Argyll (Mr. MacKay) — the question of the role of the Countryside Commission in planning matters affecting the Highland region. It is a matter of some concern, as my hon. Friend the Under-Secretary of State well knows, and here I would take with me from the Labour Benches at least the hon. Member for Caithness and Sutherland (Mr. MacLennan). That is perhaps something for which to be grateful.
The other matter on which I should like to touch is the Government proposal to consider the introduction of charges for planning applications going through local authorities. That is a measure that could well have merited consideration within the framework of a Bill such as this, so that the whole idea and implication of it could have been more fully considered by the House. None the less, in spite of those reservations, I am sure that I speak for my constituents when I say that we welcome the determination of the Secretary of State to keep a firm grasp on the nation's finances and to keep his responsibility for having the money spent in a responsible fashion.

9. 13 pm

Mr. George Foulkes: I am forced to be brief, but commendably, following the hon. Member for Moray and Nairn (Mr. Pollock), I may have a few more minutes than I expected.
I have only three points to make. There has been some criticism today — my hon. Friend the Member for Glasgow, Provan (Mr. Brown) was among the critics—of councillors in local authorities. It will be much more difficult to get anyone to serve in a local authority once the Bill gets, through, because it will be totally frustrating for local authority members. They will have no power, no freedom and no authority whatever. They are being snatched from them. What do they get? They get power over fees for cremation, the safe of methylated spirits and the provision of cattle grids. I can imagine Dick Stewart

and other people enjoying that great new freedom. But in the areas of real control of capital and revenue expenditure they will be circumscribed by the Secretary of State, as my colleagues have pointed out on a number of occasions.
I get fed up hearing time after time from Conservative Members about the bureaucrats in local authorities. As hon. Members have said, these are home helps, teachers, bus drivers, bin men—people providing vital services. Whatever the hon. Member for Edinburgh, South (Mr. Ancram) may say—I have corrected him on previous occasions and will continue to do so—only a very small percentage are involved in administration.
My second point concerns quangos. In an intervention, I complained about the abolition of the River Purification Advisory Committee, which will save a very small amount. I was going to say a "piddling little amount", but that seemed inappropriate. Yet it is doing a vital job.
I could suggest how the Secretary of State could save a great deal of money. He could get rid of a number of quangos in Scotland by getting rid of new town development corporations. They are homes for many retired brigadiers, who can earn a great deal of money. Many of them hold the elected members of local authorities in contempt. I hope that power will be handed over to the elected members of local authorities as quickly as possible.
Thirdly, I turn to the most serious matter. I think that my hon. Friend the Member for Berwick and East Lothian (Mr. Home Robertson) said that the authorities that underspend would not suffer any penalties. I disagree. Authorities that underspend will suffer penalties. Given the current level of expenditure by every region with the exception of the Lothian region, the regional councils stand in default of the Social Work (Scotland) Act 1968. Those local authorities have not only powers but duties. In part II, section 12 states:
It shall be the duty of every local authority to promote social welfare by making available advice, guidance and assistance on such a scale as may be appropriate for their areas.
It could be argued that Grampian, Tayside, Dumfries and Galloway are in default.
Section 14 states that it shall be the duty of every local authority to provide adequate home help for households in need. Tayside, Grampian, Dumfries and Galloway stand in default of that section.
Section 15 states:
it shall be the duty of the local authority to receive the child into their care".
Again, I contend that Dumfries, Galloway, Tayside and Grampian are in default of that section. The sooner that action is taken against authorities that are not carrying out their statutory duties, the better. However, such action should not be taken against Lothian region, which is carrying out its responsibilities.
I, for one, would support the Secretary of State if he took action against those defaulting local authorities. We have been given a hundred reasons for voting against the Bill. I have given three more.

Mr. Barry Henderson: I hope that the hon. Member for South Ayrshire (Mr. Foulkes) will forgive me if, in the interest of brevity, I do not take up his remarks.
This is a modest Bill. It might be said that it could have been wider in scope and that it could have been introduced


earlier. It is badly needed, because there is a need to control the total amount of money that local government spends. Last year the amount spent in Scotland totalled £3,750 million. That is quite a lot of peanuts. The taxpayers, for whom the Secretary of State for Scotland is responsible, coughed up 68·5 percent, of that amount. No one who coughs up 68·5 per cent. of £3,750 million could fail to take an interest in the total amount spent.
The Bill is desperately needed because justice must be done to the prudent authorities. We have heard much talk of freedom. One of my fundamental political beliefs concerns the freedom of a citizen to do what he wants. However, there is a point at which one man's freedom conflicts with that of another. It is the legislator's business to draw a boundary between those two interests. Therefore, my right hon. Friend the Secretary of State for Scotland is right to ensure that a local authority that enjoys the freedom to spend at will does not take away money from another local authority that has been careful with its money over a lengthy period and taken reasonable care of its ratepayers' services.
If I had more time, I should have taken up with my hon. Friend the Under-Secretary a number of questions about capital allocations. It cannot be right to continue the present system, under which if capital works subsequently obtain a contribution for the whole or part of the cost from another source—even a private company, for example—the total gross expenditure is deemed to be part of the authority's capital allocation. A letter that I have just received from my right hon. Friend in response to that point was not satisfactory and requires further work in the Department.
I should like my hon. Friend the Under-Secretary to clarify the question of the use of proceeds from the sale of council houses. A number of people are confused about this. Some have the impression that the proceeds can be applied to build houses over and above the number authorised under the housing capital plan and that the present capital allocations could be exceeded by an amount equivalent to that realised by the sale of council houses. On the other hand, there are those who say that the money can only be invested in, or otherwise applied to, a capital purpose connected with the housing revenue account.
I hope that as well as providing a greater reduction in controls my right hon. and hon. Friends will note what a number of my hon. Friends have said about long-term rating reform.

Mr. George Robertson: This has been a remarkable day in Scottish politics. This morning there was the Government's humiliation in the Scottish Grand Committee, where they could not even face the prospect of voting for their own proposals. That was followed by this major debate on one of the most far-reaching Scottish local government measures that we have seen. The debate has been characterised by a list of Government supporters dragooned into making speeches and obliged, by means of a smokescreen, to divert attention away from the key areas of the debate and on to such esoteric subjects as cremation, methylated spirits and rating and valuation.
One of those who spoke tonight and did not speak this morning, but who was also one of the main abstainers on the Government side, was the hon. Member for

Edinburgh, South (Mr. Ancram). He came out with his rehearsed and many times delivered speech about the alleged iniquities of the Lothian region. By the purest of coincidences, there came into my hands this evening a document leaked from one of the 1974 elections, in which the hon. Gentleman was given his come uppance by the electors of Berwick and East Lothian. In the hon. Gentleman's October election address, printed in the blue of his party, we read:
You Know Ancram Works For You!
As if to provide some proof, there are reprints of a number of newspaper headlines, only some of which I shall read out. They include:
Public transport needs immediate help says MP".
MP stresses urgent need for more houses".
MP's plea to Healey for small firms aid".
MP wants maternity ward kept open".
Last but not least, in the true vein of most of the Conservative speeches tonight, there is the headline:
Central Government should subsidise festivals, says Ancram".
The report in small print underneath should interest the hon. Member for Aberdeenshire, East (Mr. McQuarrie):
Financial assistance from central government should be made available for Festivals, Common Ridings and Gala Days",
said the doomed Member for Berwick and East Lothian, the Mad Marxist of Morningside.

Mr. Ancram: Would not the hon. Gentleman accept that after five months of Labour Government that was the sort of thing that all hon. Members were asking for?

Mr. Robertson: That poor answer shows that it requires a great deal of rehearsal for the hon. Gentleman to make some of the statements that he is noted for in the House.
The Bill is no less than a Christmas catalogue from the Government for more centralisation, more bureaucratic paternalism and more of that kind of sanctimonious "We know best" attitude which have come to characterise the Government's relationship with elected local government. In this one area of government outwith the Palace which is still left in this country where the sanction of the ballot box prevails, the Bill and its big brother, the Local Government, Planning and Land (No. 2) Act 1980, mount a full frontal attack on the foundations of local government accountability and representative democracy. What price Tory freedom when big brother Government must usurp the role of the ballot box? What price local discretion when Whitehall and New St. Andrew's House can pull all the strings, and not just most of them?
If there is financial excess or parsimony in local government, why not let the final arbiter be the ballot box? Has the party that stemmed from local government, the party of Austen Chamberlain among others, so little faith in the intelligence, perception or judgment of the electorate that it must now impose this galaxy of controls, reserve powers and constraints to protect the elector from his own folly, or, perhaps, his own wisdom?
The new powers in the Bill on rates, spending, grants, lending and borrowing, definitions, time limits and timetables bring to the Scottish Office an entirely unprecedented and unique new role of overseeing and directly controlling the work and functions of local government in Scotland. They give the commissars of New St. Andrew's House some more Politburo powers to


eliminate the freedom of action of any but that small elite behind the closed doors who make Scotland's decisions for the Scots.
Do the Government really care about local democracy? Do they care about the lasting damage that they will cause through the Bill to local government in Scotland?
Only nine years ago, in 1971, it might conceivably have been thought that the Conservative Government cared about the basic principle of local representative democracy. In February 1971 the Conservative Government published a White Paper entitled "Local Government in England". The keynote of that document quoted in the Layfield committee's thorough-going report on local government finance was:
A vigorous local democracy means that authorities must be given real functions—with powers of decision and the ability to take action without being subjected to excessive regulation by central government through financial or other controls … above all else, a genuine local democracy implies that decisions should be taken—and should be seen to be taken—a; locally as possible.
That White Paper followed only 12 months after a White Paper from the Labour Government which had in almost identical, terms reaffirmed the commitment of that Administration to the rights, duties, obligations and responsibilities of local government.
What happened to the consensus of 1970 and 1971? Thereafter, the Layfield committee and the Wheatley Royal Commission on Local Government in Scotland also tackled the vexed question of the relationship between local authorities and the Government, especially as affected by local authority finance. That is what we are debating this evening. We are not talking about cremations, the liberation of methylated spirits Administrations or the minutiae of rating and valuation. It is essentially an assault on local authority responsibility and accountability. The Layfield committee's report clearly stated:
The increasingly detailed intervention by the government which has been occurring is incompatible with that measured consideration of local expenditure needs and priorities, judged by local conditions and requirements and with local taxation decisions reflecting local expenditure decisions, which lies at the heart of fully responsible local government.
The Wheatley Commission came down clearly on the side of local authorities and maximum flexibility. The commission said that the Treasury view was for
local authorities to raise more of their own finances, so that they have 'sufficient incentive to take spending decisions responsibly and to secure economy and value for money'.
The whole tenor of the detailed studies on local authorities and their finances in the last 10 years is decisively in favour of less Government intervention, more local autonomy, more responsibility and more chance for the electorate to make the ultimate decision on the capacity of local government to look after itself.
What do the Government intend to do? In July last year, the Secretary of State was interviewed by Mr. David Scott of The Scotsman. Mr. Scott is a perceptive reporter and he asked the question that came first to mind, given the rumours about the intention of the Secretary of State for the Environment for local government in England. Mr. Scott asked:
There has been talk of legislation to limit rates rises. Can you confirm that this is a possibility?
The Secretary of State replied:
There has been some discussion on this in the South. But I am my own master in Scotland on this matter and I do not envisage that this; action will be necessary as I expect local authorities; in Scotland to act in a responsible manner.

No one can tell me that the Bill was dreamt up in the last two or three weeks, or even in the lead-up to the Queen's Speech. It was predestined throughout the last Parliament.
The Bill has three principal functions hidden behind a smokescreen. First, it tightens up the regulations relating to the rate support grant by providing more power to intervene and interfere arbitrarily. Secondly, it tightens the housing support grant and accelerates the trend to higher rates, lower support and massive cuts in resources for housing which was envisaged in the public expenditure White Paper. Thirdly, it tightens capital control through the various loan sanctions that already exist in the Scottish Office portfolio. Capital consent and sanctions which were, as the Layfield committee said, designed originally purely as a safeguard against local authority impropriety are now to be strengthened and tightened so that the commissars at New St. Andrew's House can have the same power as the commissars in the Department of the Environment in declaring moratoriums on all council house building programmes when the whim arises.
Clause 13 is remarkable. Its powers are unprecedented, arbitrary and absolute. The Secretary of State can do what he wants with any local authority which transgresses any standard that the right hon. Gentleman cares to invent. The Secretary of State is extending the powers in the 1973 Act, which go back to 1948 and which have never been used.
The Bill allows the Secretary of Slate to compare the expenditure performance of one local authority with that of others, to make a comparison in relation to the general economic conditions and, to ensure that nobody fails to get caught, to do anything else that he brings to mind. His powers are absolute. The Secretary of State will have power to invent any criteria and to apply them to any local authority in Scotland. One is driven to ask why he bothered to include clause 13 (a) and (b) when he has clause 13 (c).
It is interesting to make a comparison with the Local Government, Planning and Land (No. 2) Act — that tome that rivals the Bible in size and which was enacted recently. The power that the Secretary of State for Scotland has taken unto himself is substantially greater than that which even the Secretary of State for the Environment thought relevant to the English provision. Section 5 of the Local Government, Planning and Land Act provides for the Secretary of State for the Environment to reduce any element in any authority's rate support grant, on one condition only. That condition is a comparison with other local authorities. He does not have the fail-safe, "Catch 22" devices invented by the Scottish Office to give this draconian power to the Secretary of State for Scotland. Moreover, even if the Secretary of State wanted to reduce the level of rates in the way that has been suggested, could this possibly work? It is still open to a local authority to rate in a future year for the shortfall in its rate support grant element in the year that has been affected.
The powers contained in clauses 13 and 14, and the new additional powers for a moratorium contained in clause 23 on loan consents, will mean more interference, more meddling, less flexibility and less and less responsibility and accountability in local government in Scotland. We are asked to accept at face value the modest, moderate intentions of the Secretary of State for Scotland, who tells us that he will not use the powers against anyone other than the ultimate transgressor on any conditions that he cares to invent. He says that in a reasonable manner to a reasonable reception in a reasonable House, but the history


of the Government over the past 12 months clearly indicates that they will indeed use these powers. They will use them ruthlessly, regularly and arbitrarily against anyone who offends against their prejudices.

Mr. Lang: Will the hon. Gentleman therefore say whether the Labour Party, if it is ever returned to power, will repeal this measure?

Mr. Robertson: Yes. I dare say that the provisions regarding cremations, methylated spirits and the various other matters that have ranked so high among the priorities of Government Members tonight will have to be the subject of some consideration. But, so far as these draconian powers are concerned, the answer to the hon. Member for Galloway (Mr. Lang) is quite clearly "Yes".
What can we learn from the past 12 months of Tory Government? What can we learn from their attitude to local authorities? They have used local councils as stalking horses for their own discredited ideologies. Local authorities have been left to do the dirty work for Ministers who swan around the public engagement circuit. Local authorities are left to take the decisions about sacking teachers, closing old folks' homes, cancelling adult training centres, indefinitely postponing promised house modernisation programmes or cutting back on the fostering of unwanted children, while Ministers juggle with the intricacies of the PSBR and hide behind the subversive legal jargon of this kind of meddlers' manifesto.
All the draconian powers against which the Conservatives have set their faces over the years are contained in the Bill to inflict damage on local authorities that they will arbitrarily pick upon. This debate has produced from the Government Benches speeches of great length without great content, but the Government have still not told us which are the local authorities with such dreadful records that these draconian powers had to be introduced.
My hon. Friend the Member for Edinburgh, Central (Mr. Cook) gave us chapter and verse of the Lothian experience and the detail that contradicts all the mad gesticulations of the hon. Member for Edinburgh, South. My hon. Friend the Member for Dundee, West (Mr. Ross) was too modest in his defence of his city's district council, which, let it be said, in the last round of rate increases cut its rate by 14 per cent. It was surrounded by Tory district councils that increased their rate and a Tory regional council that increased it by 18 per cent. [HON. MEMBERS: "It was a Tory council".] Dundee was not Tory-controlled at the time the rates were fixed.
The statistics produced in their own selective way have shown that the profligacy cannot be substantiated in any of the ways put forward by Conservative Members. The Conservative Party cries for freedom and the dismantling of controls but gives us a Bill of new controls that are more draconian, arbitrary, sweeping and pernicious than any that have been seen in this country before. Conservative Members cry, when it suits them, for local government discretion and democracy, yet they rob local government of all its powers, discretion and mandate. They cry for control of inflation, yet they impose on local authorities conditions which demand huge rate increases and new burdens on services. They cry tears for the level of the

unemployed, but every week they shamelessly exhort local councils to sack and dismiss more and more of their employees, who will have no hope of alternative work.
This is a Government without principle, scruple or vision. They are a Government without support in Scotland. This is a dangerous, needless and senseless Bill, which will damage the very foundation of local democracy in Scotland. It must be vigorously resisted, and I call on all my right hon. and hon. Friends to vote against it this evening.

The Under-Secretary of State for Scotland (Mr. Malcolm Rifkind): The speech of the hon. Member for Hamilton (Mr. Robertson) will, if nothing else, be memorable for the fulsome if unintended tribute to the Dundee Conservative group and its decision last May.
Before turning to the provisions of the Bill, it would be right for me to preface my remarks by offering my congratulations to the right hon. Member for Glasgow, Craigton (Mr. Millan) on his appointment to the Shadow Cabinet. For the second year running, having been frustrated by the democratic processes of his party, the right hon. Gentleman was rescued by the powers of patronage—

Mr. Foulkes: Mr. Foulkes rose—

Mr. Rifkind: It would appear that he has confounded the fears of his friends and the prophecies of his enemies and shown for the second year running—

Mr. Dennis Canavan: The hon. Gentleman crawled to Thatcher and she appointed him.

Mr. Deputy Speaker: Order. Perhaps I will be allowed to hear what the hon. Gentleman is saying.

Mr. Rifkind: The right hon. Gentleman has clearly shown that resurrection is still possible even in the 1980s.

Mr. Foulkes: Will the hon. Gentleman give way?

Mr. Rifkind: I will later, but not at the moment.
It looks as though the whole Shadow Scottish team will be with us for some time to come, contrary to the expectations of a few weeks ago. We were told that the election of the right hon. Member for Ebbw Vale (Mr. Foot) would lead to a radical change in the Scottish team. We were told that that aged revolutionary, the hon. Member for Renfrewshire, West (Mr. Buchan), would be the new Shadow Scottish Secretary and that the hon. Member for Edinburgh, Central (Mr. Cook) would be his radical deputy.

Mr. Foulkes: On a point of order, Mr. Deputy Speaker. Perhaps the Under-Secretary can tell us to which clause he is referring.

Mr. Ted Graham: Santa Clause.

Mr. Deputy Speaker: It is a rather long preamble.

Mr. Rifkind: In the Opposition's attitude to the Bill, we have seen that rather than a revolutionary revival of the Labour Party it is the ancient regime that is back again. There has been a restoration of the Bourbons. They have learnt nothing, but it would appear from their speeches that they have forgotten everything about their own practice in local government, the severe curbs that they placed on local government and the major reductions in manpower that they forced local authorities to observe during their own period in Government.
There are two main previsions in the Bill, and I shall concentrate my remarks on them. However, I wish to comment briefly on certain points that were raised during the debate. The right hon. Member for Craigton and some of his hon. Friends spoke a great deal about housing. They will appreciate that the Bill has only a marginal affect on housing.
Even if the right hon. Gentleman's worst prophecies were correct—which they are not—it would not alter the fact that he and his friends, if they understand the clauses that relate to housing support grant, will wish to vote for them. It is for that reason that the Convention of Scottish Local Authorities has not criticised these clauses and recognises that they arc highly desirable. None of the other comments that we had from the Opposition on housing matters today bore any relevance to the contents of the Bill, and they can be debated at the proper time when the housing support grant will fall to be considered by the House.
My hon. Friends the Members for Edinburgh, South (Mr. Ancram), for Aberdeenshire, East (Mr. McQuarrie) and for Galloway (Mr. Lang) spoke of the problems of the rating system and indicated their wishes to see a reform of that system. They will be aware that the Government have for some time been conducting a review of that system. But I say to my hon. Friend the Member for Edinburgh, South that when he says that he supports a local income tax I am not sure whether he has considered whether he would really wish the local authority to which he has devoted his remarks to have control over the level of tax that he would pay on that basis.
My hon. Friends the Members for Galloway and for Perth and East Perthshire (Mr. Walker) talked respectively about the publication of manpower statistics and direct labour departments. These are provisions in the Local Government, Planning and Land Act. There will, therefore, be the introduction of the very policies in favour of which they spoke as a result of that legislation.
The major point now in dispute between the two sides of the House concerns the extent to which the Government should he entitled to intervene in the business of local authorities and override a local discretion.

Mr. Canavan: Zero council housing.

Mr. Rifkind: I shall come that point if the hon. Gentleman will contain himself.
I believe—I do not think that I am saying anything controversial in this respect—that there are three major areas in which any sensible Government would recognise the need for national interest and for the national Government, on occasion, to override what local authorities would wish themselves to do. I do not dispute the views of local authorities when elected members say that they are elected in the same way as MPs and have the same local mandate as MPs. They are quite correct in that assumption. They are also correct to say that they often recognise local priorities more effectively than any national Government could hope to do. They are equally correct in saying that they are often aware of local circumstances and local pluralities that might justify different treatment for their locality compared with other areas.
But, as against those perfectly valid comments, there are major areas in which the national interest must prevail.

Mr. Canavan: Mr. Canavan rose——

Mr. Rifkind: I shall give way to the hon. Gentleman shortly, if he lets me conclude this point.

Mr. Henderson: The hon. Gentleman has not been here.

Mr. Rifkind: It is certainly true that the hon. Gentleman has not been present for virtually the whole of the debate.
There are certain areas in which I think all hon. Members would accept that the Government must have the right to intervene — for example, in the setting of regulations, such as fire regulations and road safety regulations, and matters of that kind, where the public as a whole accept uniform standards.
There are also matters of great political controversy on which, although they could be implemented locally, successive Governments have fought general elections and received the endorsement of the electorate to implement policies locally against local wishes. For example, the previous Government took such a position on comprehensive education irrespective of local authorities' wishes. I freely accept that the present Government have taken a similar position because of the endorsement of the electorate, in the same way as the Labour Government claimed such an endorsement when we dealt with the question of the sale of council houses. to sitting tenants.
These are not controversial matters, in the sense that all parties and Governments acknowledge that right when an election has been fought and won on that basis.

Mr. Canavan: Will the hon. Gentleman give way?

Mr. Dick Douglas: Will the hon. Gentleman give way?

Mr. Rifkind: I give way to the hon. Member for Dunfermline (Mr. Douglas).

Mr. McQuarrie: He has not been here, either.

Mr. Deputy Speaker: Order.

Mr. Douglas: Just because one does not make a lot of noise in this place, that does not mean that one has been absent.
I have raised this matter previously. Will the Undersecretary give some indication of where in the Tory manifesto there was provision for the disgraceful sale of the Ministry of Defence houses in Brucefield, Dunfermline? Miller of Edinburgh will make over £1 million by sitting on their backsides. The hon. Gentleman knows that, because he met a deputation of my constituents on this matter. They are being sold down the river by the disgraceful way in which the present Government have abrogated their responsibility.

Mr. Rifkind: The hon. Gentleman can raise that point when we debate housing matters. I have previously answered him on the subject and have corresponded with him about it. I shall not take up the small amount of time remaining to extend the debate on an issue that is irrelevant to the Bill.
The third major area in which any Government, including the previous Government, must recognise the rights and duties of the Government to intervene is when the expenditure of local authorities has inevitably a significant effect on the national economic strategy of the Government of the day.
My hon. Friend the Member for Fife, East (Mr. Henderson) and other hon. Members spoke of the huge


sums—running to thousands of millions of pounds—that are spent by local authorities. No one questions that their spending of that money must affect the total of public expenditure as well as the Government's counter-inflation policies, irrespective of which Government are in power. Since total local authority expenditure is relevant to national government and must be considered in the context of the national interest and given the major contribution that the Government and Parliament make towards it, it is naive and unrealistic to suggest that the Government should not have the final say on what they give local authorities to finance that expenditure.
We are considering here not powers to prevent local authorities determining the level of rates but the extent to which the Government should be able to decide how much money they give to local authorities. To suggest that it is improper or illegitimate for the Government to do that is so naive and out of touch with reality and the practice of the last Labour Government as to be neither credible nor objective.
The right hon. Member for Craigton knows that by the substantial pressure that he put on local authorities while he was Secretary of State he succeeded in reducing local authority manpower by the greatest amount in any one year over the past 20 years. The drop was between 10,000 and 12,000. It was done not because the local authorities wanted to do it but because of the pressure that the right hon. Gentleman quite rightly put upon them. When he suggests that somehow it is acceptable for local authorities to be pressed by a Labour Government but improper for a Conservative Government to do the same, he demonstrates an inconsistency that does not impress the House. In suggesting that Labour Governments are somehow different from Conservative Governments in this respect, the right hon. Gentleman reminds me of the remark that was once made that whereas under Conservatism man exploits his fellow man, under Socialism it is the other way round.
There are two differences between the attitudes of this Government and those of its predecessor. First, the Labour Government had the support not only of Conservative local authorities but of Conservative Members of Parliament when they sought, in the national interest, to reduce local authority spending. However, the support of Labour Members for this Government in pursuing that course is conspicuous by its absence.
The second major difference is that over the past 18 months — and particularly in the Bill — we have consciously sought to take powers that will be applied not indiscriminately against all local authorities but selectively against local authorities that are primarily responsible for our current problems. It is unfair to local authorities that act prudently to find that in spite of their prudence and their reductions in expenditure they are penalised and treated the same as all other local authorities.
If there is one major difference between the Bill and the previous legislation, it lies in the selective nature of the powers provided. We do not apologise for that; on the contrary, we are proud of it. The local authorities prefer it to the bludgeon that the right hon. Member for Craigton used when he was Secretary of State.
Many of the comments of Labour Members have referred to the power to withdraw grant from a local authority that is proposing to spend, or is spending, sums

that are judged to be excessive and unreasonable. We have been told that this is a radical and draconian new measure quite different from any previous legislative power. I refer those who hold that view to the terms of the 1966 Act. It was enacted by a Labour Government and it repeated the terms of the 1948 Act, which was also enacted by a Labour Government. It provided specifically that when a local authority's spending was, in the view of the Secretary of State, excessive and unreasonable, rate support grant could be withdrawn.
The only significant difference between the provisions in the Labour Government's Act and the provisions in the Bill is that under the Labour provisions the local authority had to have spent the money before grant could be withdrawn. In our case, we propose to act on the budget for proposed spending. The Labour Government, through the provisions in their Act, wished to close the stable door after the horse had bolted. We prefer to do it before the damage has been done. That seems a more sensible course of action. When Opposition Members question whether the term "excessive and unreasonable" is a proper approach to these matters, they should remember the comments of the Labour Minister in charge of the Labour Government's measure when it passed through the House. It was the right hon. Member for Greenock and Port Glasgow (Dr. Mabon), who said:
One does not give more money to those who behave extravagantly. All that one can do is to take away money.
He continued, in regard to the excessive and unreasonable criteria:
this is the only sensible way of going about it without denying that local government rests on local democracy.
He ended his remarks by saying — and this sounds phoney in today's circumstances:
This is not a party matter; it is a matter which involves every hon. Member."—[Official Report, Scottish Grand Committee, 7 July 1966; c. 176–8.]
That was the attitude of the Labour Minister when he put forward proposals to deal with excessive and unreasonable expenditure. It is sad that his Labour successors whom we see before us today take such a puny and indefensible attitude when dealing with a similar problem.
My hon. Friend the Member for Edinburgh, South asked whether the powers would be sufficient to prevent local authorities that are determined to spend excessively from doing so. Of course, he is right. There is nothing in the Bill that can veto a proposed rate increase by a local authority. That cannot be done under any of the provisions. Any rational local authority would think hard about continuing with proposals to spend excessively and unreasonably, knowing that the powers would be available to my right hon. Friend. In Scotland once it has fixed its rate, such an authority has no power to fix a supplementary rate. If, as a consequence of its excessive and unreasonable proposals, it loses an equivalent amount of rate support grant, the authority would penalise its ratepayers without having a single extra penny of resources to make available for its excessive and grandiose schemes.

Mr. Cook: The Minister said that the advantages of the measures is that they shut the door before the horse has bolted. Surely he will confirm that he said that the powers, if invoked, will come far too late to affect the rate that has been struck. As a result of the measures, the ratepayers will end up paying the rates that he thinks excessive and unreasonable, but they will not receive the services because he is withholding the grant to pay for them.

Mr. Rifkind: It is precisely that reason that will convince any rational authority not to embark on that course. I am glad that the hon. Gentleman has confirmed the value of the proposals. Some local authorities do not object to penalising their ratepayers if that gives them more money to spend on grandiose schemes. No rational authority will wish to incur the opprobrium of the public and, at the same time, not have an additional penny to spend on its favourite projects. If we are dealing with rational authorities, which, for the most part, we are, that will be a sufficient and adequate response to deal with the problems raised by hon. Members
The question before the House is whether, given that in the case of one or two Scottish authorities there has been excessive expenditure, the powers are reasonable or unreasonable. Will they be used selectively or indiscriminately? Opposition Members suggested that there will be an indiscriminate use of the powers. They have not provided one iota of evidence, because the truth of the matter is that it will depend on the attitude of local authorities. I have no doubt that the vast majority of local authorities will moderate their expenditure and will try to keep their spending plans in line with the national interest. If they do so, they have nothing to fear.
The Opposition do not know why they are opposing these measures, which merely add to the powers that Labour Governments have used. Their reaction against the Bill is Pavlovian and does not command the respect of the people of Scotland. I call upon my right hon. and hon. Friends to support the Bill. They can be sure that the people of Scotland will welcome what they do.

Question put, That the Bill be now read a Second time:—

The House divided: Ayes 315, Noes 260.

Division No. 15]
[10 pm


AYES


Abse, Leo
Browne, John (Winchester)


Adley, Robert
Bruce-Gardyne, John


Aitken, Jonathan
Bryan, Sir Paul


Alexander, Richard
Buck, Antony


Alison, Michael
Budgen, Nick


Amery,Rt Hon Julian
Bulmer, Esmond


Ancram, Michael
Burden, Sir Frederick


Arnold, Tom
Butcher, John


Aspinwall, Jack
Butler, Hon Adam


Atkins, Robert(Preston N)
Cadbury, Jocelyn


Atkinson, David (B'm'th,E)
Carlisle, John (Luton West)


Baker, Nicholas (N Dorset)
Carlisle, Kenneth (Lincoln)


Banks, Robert
Carlisle, Rt Hon M (R'c'n )


Beaumont-Dark, Anthony
Chalker, Mrs. Lynda


Bell, Sir Ronald
Channon, Rt. Hon. Paul


Bendall, Vivian
Chapman, Sydney


Benyon, Thomas (A'don)
Churchill, W. S.


Benyon, W. (Buckingham)
Clark, Hon A. (Plym'S'n)


Bevan, David Gilroy
Clark, Sir W. (Croydon S)


Biffen, Rt Hon John
Clarke, Kenneth (Rushcliffe)


Biggs-Davison, John
Clegg, Sir Walter


Blackburn, John
Cockeram, Eric


Blaker, Peter
Colvin, Michael


Bonson Sir Nicholas
Cope, John


Boscawen, Hon Robert
Cormack, Patrick


Bottomley, Peter (W'wich W)
Corrie, John


Bowden, Andrew
Costain, Sir Albert


Boyson, Dr Rhodes
Cranborne, Viscount


Braine. Sir Bernard
Critchley, Julian


Bright, Graham
Crouch, David


Brinton, Tim
Dean, Paul (North Somerset)


Brittan, Leon
Dickens, Geoffrey


Brocklebank-Fowler, C.
Dorrell, Stephen


Brooke, Hon Peter
Douglas-Hamilton, Lord J.


Brotherton, Michael
Dover, Denshore


Brown, M.(Brigg and Scun)
du Cann, Rt Hon Edward





Dunn, Robert (Dartford)
Kitson, Sir Timothy


Durant, Tony
Knight, Mrs Jill


Dykes, Hugh
Knox, David


Eden, Rt Hon Sir John
Lamont, Norman


Edwards, Rt Hon N. (P'broke)
Lang, Ian


Eggar, Tim
Langford-Holt, Sir John


Elliott, Sir William
Latham, Michael


Emery, Peter
Lawrence, Ivan


Eyre, Reginald
Lawson, Nigel


Fairbairn, Nicholas
Lee, John


Fairgrieve, Russell
Lennox-Boyd, Hon Mark


Faith, Mrs Sheila
Lester Jim (Beeston)


Farr, John
Lewis, Kenneth (Rutland)


Fell, Anthony
Lloyd, Ian (Havant &amp; W'loo)


Fenner, Mrs Peggy
Lloyd, Peter (Fareham)


Finsberg, Geoffrey
Loveridge, John


Fisher, Sir Nigel
Luce, Richard


Fletcher, A. (Ed'nb'gh N)
Lyell, Nicholas


Fookes, Miss Janet
Macfarlane, Neil


Forman, Nigel
MacGregor, John


Fowler, Rt Hon Norman
MacKay, John (Argyll)


Fox, Marcus
Macmillan, Rt Hon M.


Fraser, Rt Hon Sir Hugh
McNair-Wilson, M. (N'bury)


Fraser, Peter (South Angus)
McNair-Wilson, P. (New F'st)


Fry, Peter
McQuarrie, Albert


Galbraith, Hon T. G. D.
Madel, David


Gardiner, George (Reigate)
Major, John


Gardner, Edward (S Fylde)
Marland, Paul


Garel-Jones, Tristan
Marlow, Tony


Glyn, Dr Alan
Marshall Michael (Arundel)


Goodhart, Philip
Marten, Neil (Banbury)


Goodhew, Victor
Mates, Michael


Goodlad, Alastair
Mather, Carol


Gorst, John
Maude, Rt Hon Angus


Gow, Ian
Mawby, Ray


Gower, Sir Raymond
Mawhinney, Dr Brian


Grant, Anthony (Harrow C)
Maxwell-Hyslop, Robin


Gray, Hamish
Mayhew, Patrick


Greenway, Harry
Mellor, David


Grieve, Percy
Meyer, Sir Anthony


Griffiths, E.(B'y St. Edm'ds)
Miller, Hal (B'grove)


Griffiths, Peter Portsm' h N)
Mills, lain (Meriden)


Grist, Ian
Mills, Peter (West Devon)


Grylls, Michael
Miscampbell, Norman


Gummer, John Selwyn
Mitchell, David (Basingstoke)


Hamilton, Hon A.
Moate, Roger


Hamilton, Michael (Salisbury)
Monro, Hector


Hampson, Dr Keith
Montgomery, Fergus


Hannam, John
Moore, John


Haselhurst, Alan
Morris, M. (N'hampton S)


Hastings, Stephen
Morrison, Hon C. (Devizes)


Havers, Rt Hon Sir Michael
Morrison, Hon P. (Chester)


Hawkins, Paul
Mudd, David


Hawksley, Warren
Myles, David


Hayhoe, Barney
Neale, Gerrard


Heddle, John
Needham, Richard


Henderson, Barry
Nelson, Anthony


Heseltine, Rt Hon Michael
Neubert, Michael


Hicks, Robert
Newton, Tony


Higgins, Rt Hon Terence L.
Nott, Rt Hon John


Hill, James
Onslow, Cranley


Hogg, Hon Douglas (Gr'th'm)
Oppenheim, Rt Hon Mrs S.


Holland, Philip (Carlton)
Osborn, John


Hooson, Tom
Page, John (Harrow, West)


Hordern, Peter
Page, Richard (SW Herts)


Howe, Rt Hon Sir Geoffrey
Parkinson, Cecil


Howell, Ralph (N Norfolk)
Parris, Matthew


Hunt, David (Wirral)
Patten, Christopher (Bath)


Hunt, John (Ravensbourne)
Patten, John (Oxford)


Hurd, Hon Douglas
Pattie, Geoffrey


Irving, Charles (Cheltenham)
Pawsey, James


Jenkin, Rt Hon Patrick
Percival, Sir Ian


Jessel, Toby
Peyton, Rt Hon John


Johnson Smith, Geoffrey
Pink, R. Bonner


Jopling, Rt Hon Michael
Pollock, Alexander


Joseph, Rt Hon Sir Keith
Porter, Barry


Kellett-Bowman, Mrs Elaine
Prentice, Rt Hon Reg


Kershaw, Anthony
Price, Sir David (Eastleigh)


Kimball, Marcus
Prior, Rt Hon James


King, Rt Hon Tom
Proctor, K. Harvey






Raison, Timothy
Taylor, Robert (Croydon NW)


Rathbone, Tim
Taylor, Teddy (S'end E)


Rees, Peter (Dover and Deal)
Tebbit, Norman


Rees-Davies, W. R.
Temple-Morris, Peter


Renton, Tim
Thatcher, Rt Hon Mrs M.


Rhodes James, Robert
Thomas, Rt Hon Peter


Rhys Williams, Sir Brandon
Thompson, Donald


Ridley, Hon Nicholas
Thorne, Neil (Ilford South)


Ridsdale, Julian
Thornton, Malcolm


Rifkind, Malcolm
Townend, John (Bridlington)


Rippon, Rt Hon Geoffrey
Townsend, Cyril D, (B'heath)


Roberts, M. (Cardiff NW)
Trippier, David


Roberts, Wyn (Conway)
Trotter, Neville


Rossi, Hugh
van Straubenzee, W. R.


Rost, Peter
Vaughan, Dr Gerard


Royle, Sir Anthony
Viggers, Peter


Sainsbury, Hon Timothy
Waddington, David


St. John-Stevas, Rt Hon N.
Wakeham, John


Scott, Nicholas
Waldegrave, Hon William


Shaw, Michael (Scarborough)
Walker, B. (Perth)


Shelton, William (Streatham)
Walker-Smith, Rt Hon Sir D.


Shepherd, Colin (Hereford)
Wall, Patrick


Shepherd, Richard
Waller, Gary


Shersby, Michael
Walters, Dennis


Silvester, Fred
Ward, John


Sims, Roger
Warren, Kenneth


Skeet, T. H. H.
Watson, John


Smith, Dudley
Wells, John (Maidstone)


Speed, Keith
Wells, Bowen


Speller, Tony
Wheeler, John


Spence, John
Whitney, Raymond


Spicer, Michael (S Worcs)
Wickenden, Keith


Sproat, Ian
Wiggin, Jerry


Squire, Robin
Wilkinson, John


Stainton, Keith
Williams, D.(Montgomery)


Stanbrook, Ivor
Winterton, Nicholas


Stanley, John
Wolfson, Mark


Steen, Anthony
Young, Sir George (Acton)


Stevens, Martin
Younger, Rt Hon George


Stewart, Ian (Hitchin)



Stewart, J.(E Renfrewshire)
Tellers for the Ayes:


Stokes, John
Mr. Spencer Le Marchant


Stradling Thomas, J.
and Mr. Anthony Berry.


Tapsell, Peter





NOES


Abse, Leo
Carter-Jones, Lewis


Adams, Allen
Cartwright, John


Allaun, Frank
Clark, Dr David (S Shields)


Alton, David
Cocks, Rt Hon M. (B'stol S)


Anderson, Donald
Cohen, Stanley


Archer, Rt Hon Peter
Coleman, Donald


Armstrong, Rt Hon Ernest
Concannon, Rt Hon J. D.


Ashley, Rt Hon Jack
Conlan, Bernard


Ashton, Joe
Cook, Robin F.


Atkinson, N.(H'gey,)
Cowans, Harry


Bagier, Gordon AT.
Cox, T. (W'dsw'th, Toot'g)


Barnett, Guy (Greenwich)
Craigen, J. M.


Barnett, Rt Hon Joel (H'wd)
Crowther, J. S.


Beith, A. J.
Cryer, Bob


Benn, Rt Hon A. Wedgwood
Cunliffe, Lawrence


Bennett, Andrew(St'kp't N)
Cunningham, G. (Islington S)


Bidwell, Sydney
Cunningham, Dr J. (W'h'n)


Booth, Rt Hon Albert
Dalyell, Tarn


Boothroyd, Miss Betty
Davidson, Arthur


Bottomley, Rt Hon A.(M'b'ro)
Davies, Rt Hon Denzil (L'lli)


Bradley, Tom
Davies, Ifor (Gower)


Bray, Dr Jeremy
Davis, Clinton (Hackney C)


Brown, Hugh D. (Provan)
Deakins, Eric


Brown, R. C. (N'castle W)
Dean, Joseph (Leeds West)


Brown, Ron (E'burgh, Leith)
Dempsey, James


Brown, Ronald W. (H'ckn'y S)
Dewar, Donald


Buchan, Norman
Dixon, Donald


Callaghan, Rt Hon J.
Dobson, Frank


Callaghan, Jim (Midd't'n &amp; P)
Dormand, Jack


Campbell, Ian
Douglas, Dick


Campbell-Savours, Dale
Douglas-Mann, Bruce


Canavan, Dennis
Dubs, Alfred


Cant, R. B.
Duffy, A. E. P.


Carmichael, Neil
Dunn, James A.





Dunnett, Jack
McKay, Allen (Penistone)


Dunwoody, Hon Mrs G.
McKelvey, William


Eadie, Alex
MacKenzie, Rt Hon Gregor


Eastham, Ken
Maclennan, Robert


Edwards, R. (W'hampt'n S E)
McNally, Thomas


Ellis, R. (NE D'bysh're)
McQuade, John


English, Michael
McTaggart, Robert


Ennals, Rt Hon David
McWilliam, John


Evans, loan (Aberdare)
Marks, Kenneth


Evans, John (Newton)
Marshall, Dr Edmund (Goole)


Ewing, Harry
Marshall, Jim (Leicester S)


Faulds, Andrew
Martin, M(G'gow S'burn)


Field, Frank
Mason, Rt Hon Roy


Fitch, Alan
Maxton, John


Flannery, Martin
Maynard, Miss Joan


Fletcher, Raymond (Ilkeston)
Meacher, Michael


Fletcher, Ted (Darlington)
Mellish, Rt Hon Robert


Foot, Rt Hon Michael
Mikardo, Ian


Ford, Ben
Millan, Rt Hon Bruce


Forrester, John
Miller, Dr M. S. (E Kilbride)


Foulkes, George
Mitchell, Austin (Grimsby)


Fraser, J. (Lamb'th, N'w'd)
Mitchell, R. C. (Soton Itchen)


Freeson, Rt Hon Reginald
Morris, Rt Hon A. (W'shawe)


Garrett, John (Norwich S)
Morris, Rt Hon C. (O'shaw)


Garrett, W. E. (Wallsend)
Morris, Rt Hon J. (Aberavon)


George, Bruce
Moyle, Rt Hon Roland


Gilbert, Rt Hon Dr John
Mulley, Rt Hon Frederick


Ginsburg, David
Newens, Stanley


Golding, John
Oakes, Rt Hon Gordon


Graham, Ted
Ogden, Eric


Grant, George (Morpeth)
O'Halloran, Michael


Grant, John (Islington C)
O'Neill, Martin


Grimond, Rt Hon J.
Orme, Rt Hon Stanley


Hamilton, James (Bothwell)
Owen, Rt Hon Dr David


Hamilton, W. W. (C'tral Fife)
Paisley, Rev Ian


Hardy, Peter
Palmer, Arthur


Harrison, Rt Hon Walter
Park, George


Hattersley, Rt Hon Roy
Parker, John


Haynes, Frank
Parry, Robert


Healey, Rt Hon Denis
Pavitt, Laurie


Heffer, Eric S.
Pendry, Tom


Hogg, N. (E Dunb't'nshire)
Penhaligon, David


Holland, S. (L'b'th, Vauxh'll)
Powell, Raymond (Ogmore)


Home Robertson, John
Prescott, John


Homewood, William
Price, C. (Lewisham W)


Hooley, Frank
Race, Reg


Horam, John
Radice, Giles


Howell, Rt Hon D.
Rees, Rt Hon M (Leeds S)


Howells, Geraint
Richardson, Jo


Hudson Davies, Gwilym E.
Roberts, Albert (Normanton)


Hughes, Mark (Durham)
Roberts, Allan (Bootle)


Hughes, Robert (Aberdeen N)
Roberts, Ernest (Hackney N)


Hughes, Roy (Newport)
Roberts, Gwilym (Cannock)


Janner, Hon Greville
Robertson, George


Jay, Rt Hon Douglas
Robinson, G. (Coventry NW)


John, Brynmor
Rodgers, Rt Hon William


Johnson, James (Hull West)
Rooker, J. W.


Johnson, Walter (Derby S)
Roper, John


Jones, Rt Hon Alec (Rh'dda)
Ross, Ernest (Dundee West)


Jones, Barry (East Flint)
Rowlands, Ted


Jones, Dan (Burnley)
Ryman, John


Kaufman, Rt Hon Gerald
Sandelson, Neville


Kerr, Russell
Sever, John


Kilfedder, James A.
Sheerman, Barry


Kilroy-Silk, Robert
Sheldon, Rt Hon R.


Kinnock, Neil
Shore, Rt Hon Peter


Lambie, David
Short, Mrs Renée


Lamborn, Harry
Silkin, Rt Hon J. (Deptford)


Leadbitter, Ted
Silkin, Rt Hon S. C. (Dulwich)


Leighton, Ronald
Silverman, Julius


Lestor, Miss Joan
Smith, Cyril (Rochdale)


Lewis, Arthur (N'ham NW)
Smith, Rt Hon J. (N Lanark)


Lewis, Ron (Carlisle)
Snape, Peter


Litherland, Robert
Soley, Clive


Lofthouse, Geoffrey
Spearing, Nigel


Lyon, Alexander (York)
Spriggs, Leslie


Lyons, Edward (Bradf'd W)
Steel, Rt Hon David


McCartney, Hugh
Stewart, Rt Hon D. (W Isles)


McDonald, Dr Oonagh
Stoddart, David


McGuire, Michael (Ince)
Stott, Roger






Strang, Gavin
White, J. (G'gow Pollok)


Straw, Jack
Whitehead, Phillip


Summerskill, Hon Dr Shirley
Whitlock, William


Taylor, Mrs Ann (Bolton W)
Willey, Rt Hon Frederick


Thomas, Jeffrey (Abertillery)
Williams, Rt Hon A.(S'sea W)


Thomas, Mike (Newcastle E)
Williams, Sir T. (Warrington)


Thomas., Dr R, (Carmarthen)
Wilson, Gordon (Dundee E)


Thorne, Stan (Preston South)
Wilson, Rt Hon Sir H.(H'ton)


Tilley, John
Wilson, William (C'try SE)


Tinn, James
Winnick, David


Torney, Tom
Woodall, Alec


Varley, Rt Hon Eric G.
Woolmer, Kenneth


Wainwright, E.(Dearne V)
Wrigglesworth, Ian


Walker, Rt Hon H.(D'caster)
Young, David (Bolton E)


Watkins., David



Weetch Ken
Tellers for the Noes:


Welsh, Michael
Mr. Terry Davis and


White, Frank R.
Mr. George Morion.

Question accordingly agreed to.

Bill read a second time.

Bill committed to a Standing Committee pursuant to Standing Order No. 40 (Committal of Bills).

Orders of the Day — LOCAL GOVERNMENT (MISCELLANEOUS PROVISIONS) (SCOTLAND) [MONEY]

Queen's Recommendation having been signified—

Resolved,
That, for the purposes of any Act of the present Session to make further provision as regards local government in Scotland and to amend the Housing (Scotland) Acts 1966 to 1980, it is expedient to authorise the payment out of money provided by Parliament of any increase in the sums so payable under or by virtue of any other Act in so far as any such increase is attributable to provisions of the said Act of the present Session, —[Lord James Douglas-Hamilton.]

Northern Ireland (Education)

The Under-Secretary of State for Northern Ireland (Mr. Philip Goodhart): I beg to move,
That the draft Education (Northern Ireland) Order 1980, which was laid before this House on 28 October 1980 in the last Session of Parliament, be approved.
Before I describe the scope of the order, I hope that I shall not be too far out of order, Mr. Deputy Speaker, if I welcome the appointment of the right hon. Member for Mansfield (Mr. Concannon) as the Opposition spokesman on Northern Ireland. When I heard the news last night my first instinctive reaction was one of spontaneous delight. I am glad that his long and distinguished service in the Province has been recognised by the leader of his party. In between the 700 flights that he made while a Minister there, he made many friends in Northern Ireland, who, I am sure, share my delight at his appointment.
I do not wish to guide the Leader of the Opposition in any way, but I am sure that many will hope that this does not mean that the hon Member for Stalybridge and Hyde (Mr. Pendry) will now be moved down from his responsibilities, for both in substance and in shadow he has served Northern Ireland well.
The order makes several amendments to the Education and Libraries (Northern Ireland) Order 1972, which is the principal enactment governing education in Northern Ireland. It also repeals certain redundant nineteenth century legislation.Of the various articles in the order, article 3 is the most significant. It will have the effect of replacing the duty on education and library boards to ensure chat sufficient nursery schools and classes are

available in their areas by a discretionary power to provide nursery education. It will thus bring the Northern Ireland legislation into line with that for Great Britain—into line, that is, with the provisions of sections 24 and 25 of the Education Act 1980, and with what has always been the position in practice.
I should like to stress that the removal of the duty on education and library boards to secure the provision of education for the under-fives does not reflect any lessening of the Government's commitment to the value of nursery education in Northern Ireland. This is clearly demonstrated by the fact that between September 1979 and September 1980 650 additional places were provided in nursery schools and classes, bringing the total there to almost 6,200. An additional 100 places will be provided later in this school year.
Another important factor is the number of other 4-year-olds in Northern Ireland schools. These currently number nearly 17,000, which, together with the 4-year-olds in nursery schools and classes, means that 77 per cent. of the 4-year-olds in Northern Ireland are provided with an early start to their education.

Mr. Tam Dalyell: Is there a Government policy on the question of 4-year-olds who are Catholics or Protestants going to their nursery schools together? Do the Government have any view on this matter?

Mr. Goodhart: It so happens that the number of 4-year-olds who go to classes in controlled primary schools and those who go to classes in maintained primary schools is almost precisely the same. With regard to the provision of nursery school education, some children are in Protestant nursery schools and some are in Catholic nursery schools. I am assured that there are some mixed nursery schools as well. It is a matter of parental choice.

Rev. Ian Paisley: Will the hon. Gentleman make it clear that there is no such thing as a Protestant nursery school? There are State nursery schools but not Protestant nursery schools.

Mr. Goodhart: I readily accept that point.

Mr. James Kilfedder: Is it not disgraceful that infants between the ages of 3 and 5 years should be divided on religious lines? Will the Minister give the percentage of 3 to 5-year-olds in Northern Ireland who have places in nursery schools or nursery classes?

Mr. Goodhart: As I said, about 77 per cent. of 4-year-olds have primary or nursery school places. About 40 per cent. of 3 to 5-year-olds receive pre-school education.
It remains the Government's objective that when resources permit provision should be expanded to a level that ensures its availability to all nursery-aged children whose parents wish them to have it. Section 12 of the 1980 Act also provides that the discontinuance of nursery schools in England and Wales is subject to the approval of the Secretary of State for Education and Science. A similar amendment is unnecessary for Northern Ireland, because the existing provisions of article 11A of the 1972 order already require the approval of the Department of Education to the establishment or discontinuance of a nursery school or class.
That brings me to the removal of some of the Department of Education's supervisory powers over education and library boards. Hon. Members will


appreciate that as boards are financed entirely from central funds it is not possible for them to have the same freedom of action as local authorities in England and Wales. However, articles 4 to 6 represent a modest relaxation of detailed control. Article 4 frees from departmental control the amount of fees that may be charged for board and lodging at primary, intermediate and special schools. This, in fact, is a purely technical point. Article 5 removes the requirement that library fines and certain charges for library services be authorised by regulations. Borrowing of books will continue to be free of charge. An Order in Council would be needed to change that. Article 6 removes the Department's detailed control over boards in respect of their organisation of and participation in education conferences.
The remainder of the order is of a technical or administrative nature. The purpose of article 7 is to make it clear that, in the case of educational maintenance allowances and boarding allowances, payments may be made to parents and, in the case of students' awards, payments of fees may be made direct to the institutions they attend. This, of course, already happens in practice. Article 8 will regularise the situation where by expenditure on free books for non-fee-paying pupils at controlled grammar schools has been on an extra-statutory basis since September 1978, when grammar school scholarships were abolished.
Essentially, article 9 is a restatement of existing law, which enables the Department to prescribe in regulations the rates of salaries and allowances payable to teachers. The Examiner of Statutory Rules has expressed doubts as to whether the existing provisions allow the Department the necessary discretionary powers to decide exceptional or individual matters, and an additional paragraph — paragraph (4)(b)—has therefore been inserted to deal with the Examiner's criticism. This makes explicit provision for salaries and allowances, in cases where it is proper to do so, to be calculated upon a basis determined by the Department.
To sum up, these three articles—articles 7, 8 and 9—are technical amendments, which do not represent any change in either policy or practice.
The other articles tidy up the statute book by removing unnecessary provisions.
I commend the order to the House.

Mr. Tom Pendry: I echo the Minister's remarks about my right hon. Friend the Member for Mansfield (Mr. Concannon). Having served with my right hon. Friend in the Northern Ireland Office, I know that he will do a first-class job. I am sure that the House would like to wish his predecessor—my hon. Friend the Member for Pontypridd (Mr. John)—well in his exacting new job.
At first glance the order may appear to be an updating and progressive measure, bringing Northern Ireland into line with twentieth century education practices, especially if we look at article 10, which is to repeal no fewer than four nineteenth century Acts. Indeed, one is 167 years old. But on closer examination the order is seen to be more one of retrenchment and retrogression in educational services, certainly in the main article, article 3.
There is one bright spot that we should applaud. One of the main provisions in the proposal when first published is no longer before the House. Thanks to the good sense of hon. Members on both sides of the House, but more particularly the good sense of Members of another place, the school transport proposals have been withdrawn. If that article had remained, the hardships already experienced by families in Northern Ireland would manifestly have been made worse.
Before I turn to the principal effect of the order I should like to refer to article 5, which is ostensibly a technical rearrangement of the powers to impose fines for overdue books. I question whether giving individual education and library boards the power to levy fines, and removing the role of the Department of Education in such decisions, will not lead to an increase in those fines.
All the boards in the Province have made drastic cuts in their budgets this year. Under the article, what is to stop them from raising money from fines and other library service charges? For example, the Belfast education and library board has already reduced its spending this year by £2½ million, and there has been a 16 per cent. reduction in travel expenditure by the Western education and library board.
Clearly, the boards are suffering from a cash crisis as a result of Government policies. Consequently, I should like an assurance that the new power given to the boards will not result in prohibitive increases in library fines and general library charges in an attempt to raise additional funds. Any backhanded taxes on the use of books by the people of Northern Ireland, who are already starved of leisure resources, will be strongly resisted by the Opposition and, more important, by the library users.
I turn to the principal effect of the order, resulting from article 3. I was surprised and bemused by the Minister's comments about the Government's intentions on nursery education. He told us that the Government's aim was not to downgrade nursery education. On the contrary, they would have us believe that the provision of nursery places is high on their list of educational priorities. I believe that the converse is true.
It is plain from article 3, which replaces a duty on education and library boards to provide nursery places with a mere discretionary power, that the Government have not the least intention of increasing the number of nursery places. Instead they are providing a channel whereby the boards can reduce the number of nursery places when the exigencies of cash limits and cuts force them to curtail services to the public.
I believe that behind the order lies a multitude of sins. I totally reject the false logic that the abolition of a legal obligation, however loosely that obligation has been applied in the past, will lead to an increase in the number of nursery places. Once discretionary power replaces an obligation, the encouragement to provide education facilities for the under-fives is largely removed, especially in this difficult economic climate.
In saying that, I join the Minister in welcoming the fact that the number of nursery places provided in Northern Ireland has increased by 650 in the year up to September. That followed an increase of 625 the year before. I draw different conclusions from the Minister. I believe that is clear evidence that the obligation to provide nursery places has had an effect in Northern Ireland, despite the unrelenting curtailment of public expenditure by the Government. But I have grave doubts about any further


increase in the provision of nursery places within the province. Without the force of obligation, the education and library hoards will be faced by no statutory obstacle when planning cuts in nursery services.
I do not wish to be accused of unnecessarily tolling the death knell for nursery education in Northern Ireland, nor am I being unduly alarmist about a substitution of words, but there is clear evidence that the operation of discretionary power in the Education Act 1980 relating to mainland Britain has to date acted to the detriment of the nursery service. I am sure that hon. Members representing constituencies on which it has already had that effect will testify to that.
It is too early to project for next year the exact number of available nursery places on the mainland. However, the indications are that there will be a serious and sustained reduction in the nursery service.
Last August the Secretary of State for Education and Science approved two closures—one in Coventry and the other in Hereford and Worcester. For the coming financial year significant cuts are proposed in nursery education on a wider scale, notably in East Sussex, which has already projected the closure of all nursery schools and classes by 1982–3. In Northamptonshire, one in three nursery places will face the axe. Somerset plans to deplete the nursery service by as much as 50 per cent.
That sort of evidence leads me and my colleagues to conclude that the operation of a discretionary power regarding the provision of nursery education has only one tangible outcome: a gradual but inevitable reduction in the number of available places in nursery schools and classes. All the indications show that the removal of an obligation to provide nursery places is operating to the general detriment of nursery education in mainland Britain.
Can the Minister give an assurance tonight that similar circumstances will not prevail in Northern Ireland within the next six to 12 months? I doubt whether he can give such an assurance. I believe that if he were to do so it would be wishful thinking on his part, because article 3 has and can have only one meaning: that the future of the nursery education service in Northern Ireland will be none other than one of depletion and rundown. Unquestionably this constitutes a back-banded and back-door public expenditure cut.
In this matter our concern is given both purpose and direction by the dire social needs of the people of Northern Ireland. The Opposition have reiterated times without number—I am sure that hon. Members present are sick of hearing it—that Northern Ireland is unique in the scale of social deprivation that prevails upon its people. The Province has a higher rate of unemployment, at 15·9 per cent., than anywhere else in the United Kingdom. It has higher energy costs, higher prices, lower wages and larger households than any other part of the United Kingdom. In short, the nature and proportions of poverty are manifestly larger than in any other region. As there are more poor, so there are more disadvantage children entering schools. Nursery schools are one answer to the ever-expanding problem.
However, in Northern Ireland only 4 per cent. of children under the age of 5 receive nursery education. A mother in England has four times the chance of day care for her child, including care in pre-nursery school groups, and 18 times the chance of putting her child into a nursery school. A report published under the aegis of Lord Melchett in 1977 called "Day Care and Education for

Children in Northern Ireland" states chat for every 10,000 children under 5 in Northern Ireland there are 447 nursery places. For every 10,000 children under 5 in England there are 1,152 nursery places. The increases in places in Northern Ireland in the last few years are a drop in the ocean. A total of 38,000 places are required to meet the need. The situation in the Province is a disgrace. Every effort should be made to remedy it.
We are far from alone in our criticism of article 3. The education and library boards have expressed grave concern, as have the trade unions, particularly the teaching unions. The parents' associations have also voiced serious doubts about the implications of article 3. The Minister cannot be unaware of the strong advice from the Northern Ireland Department of Education's specially commissioned working party on social priority schools. That report clearly and positively states that nursery schools have an important part to play in areas of deprivation and social priority.
Institutions and churches have declared that they are in favour of increased nursery education. I refer to the Church Board of the Presbyterian Assembly, and the South-East education and library board. The Official Unionists, through their spokesman, William Bell, an ex-mayor of Belfast, say that it is outrageous that there should be any curtailment of nursery services The SDLP has said that a U-turn is involved, and the Republican clubs have made similar statements.
The greater level of poverty in Northern Ireland necessitates a greater level of nursery education. Article 3 will not lead to such an increase. The reverse is true. The available evidence on the operation of a discretionary power for the provision of nursery schools in mainland Britain clearly suggests that a depletion in service is likely to result if a similar change is made in Northern Ireland. Whatever the doubts now, the education boards will soon regard nursery education as less essential than some other education provisions. To remove the reqirement to ensure that sufficient nursery places are available and to replace it with a discretionary power will remove for good, under present economic circumstances, any possibility of nursery services being improved.
Article 3 is bad news for nursery schools in Northern Ireland. It is bad news for the Province, which has to bear such a heavy burden of economic and social deprivation. For those reasons we shall withhold support for the measure.

Mr. James Kilfedder: I shall concentrate on article 3, which removes the duty on education boards to provide nursery schools in Northern Ireland. It makes nursery school provision different in law from primary school, secondary school and higher education provision.
It was right of the hon. Member for Stalybridge and Hyde (Mr. Pendry) to remind the House that we are debating this order against a background of dire social need, heavy unemployment and a lower standard of living in Northern Ireland than in the rest of the United Kingdom.
At present, an education board in Northern Ireland is required, as a duty, to provide whatever primary and secondary schools are needed in the area. The board is also required to meet the demand for further education,


whatever it may be. Where a board fails to carry out those functions it could be in dereliction of either a duty or a responsibility.
However, under article 3, an education board will have neither a duty nor a responsibility to provide nursery education in future. A board does not even have to submit a scheme for nursery education, as it does for stationery and books in controlled schools, as mentioned in article 8, or for further education under article 26 of the original 1972 education order.
Despite the fact that until now there was a duty on education boards — it is right to stress this point—to ensure that sufficient nursery schools and places were provided in Ulster, today there is still a deplorable lack of nursery provision. There are countless parents who seek unsuccessfully for a place for their child in a nursery school or class. That situation cannot be tolerated.
There must be about 40,000 children in Northern Ireland within the 3 to 5-year-old age group, yet according to an answer given to me recently there are places for fewer than 40 per cent. of those children. Of course, the ambitious 1975 programme, which the previous Tory Government launched and which should have provided 150 nursery schools in a period of three years simply failed to materialise. The reason is clear. Since 1975, there has been a reduction in the amount of money available for education in the Province. That is an indictment of a Government who are prepared to invest billions of pounds in nuclear weapons rather than in the children who deserve the best that we can provide for them.

Mr. John Biggs-Davison: Oh, really.

Mr. Kilfedder: The hon. Gentleman may disagree—

Mr. Biggs-Davison: I do.

Mr. Kilfedder: —but it is much better to invest in life and the future than in the possibility of nuclear destruction. For example, billions of pounds have been spent on a replacement for Polaris.

Mr. Biggs-Davison: What life will we have if we have no defence?

Mr. Kilfedder: The situation with regard to lack of nursery schools was made bearable by the provision of nursery places for children under 5 in some primary schools. That was possible where there was spare accommodation and teachers. However, even those nursery places are now endangered—I should like the Minister to deal with this point—by the savage public expenditure cuts in Northern Ireland, as a result of which fewer teachers will be employed by the education boards. I want an absolute assurance from the Minister that those nursery places will be increased during the next 12 months.
Whether or not the duty to provide nursery education is compulsory or discretionary, it is clear that none will be provided without Government money. It is not the fault of the education boards, because unless they are provided with money from the Department of Education they cannot provide the nursery places or the schools.
But there is one hidden and perhaps unintended advantage in removing the duty on a board to provide nursery education. Regrettably, the intransigence of some

clergy has stopped the development of non-denominational nursery schools in Northern Ireland. Like primary and secondary schools, existing nursery schools are now dominated and separated along traditional sectarian lines. I regret that very much.
It was bad enough to have the entire school-going population in Northern Ireland separated at the age of 5 along sectarian lines. Now we have children separated at the age of 3, and the next move, logically, would be the separation of maternity wards into two religious groups. I had hoped that at least nursery schools would escape the denominational blight.
Perhaps the amendment in this order provides the opportunity at last to wean away nursery schools from sectarian control. As I see it, the new situation created by the amendment means that education boards will no longer be under a duty to provide nursery schools, and that where they do so provide nursery schools it must be in non-sectarian, non-denominational schools, and any Church-owned or Church-controlled nursery school will, as I interpret the amendment, henceforth be regarded as an independent school.
I should like the Minister to deal with that very serious point.

Mr. J. Enoch Powell: I shall be the third hon. Member intervening in this debate to offer a welcome to the new Shadow Secretary of State for Northern Ireland — silent though he remains, perhaps wisely, on this first occasion. During his lengthy service in Northern Ireland under the previous Administration, he won golden opinions and is still warmly remembered for his qualities of common sense, determination and good will. In whatever the right hon. Gentleman did there was no mistaking his real and lively desire to serve the people for whom he had responsibility.
Now that this order in its previous form has been eviscerated by the removal of any reference to school transport, naturally much of the discussion has centred upon article 3. I do not feel, however, that a case can be made out by those who argue that the cause and case of nursery schools and nursery places is damaged by the abolition of what must always have been a bogus "duty" to provide "sufficient" places.
The Minister informed the House that in the previous year and the year before there had been a substantial increase in the number of such places. So presumably previously sufficient places were not being provided, although there was a statutory duty to do so, and the statutory duty has done nothing whatsoever to secure it. More than one speech in this debate has drawn attention to the continuing inadequacy of nursery school places—the fact that there are no more than 40 per cent. of the children aged between 3 and 5 and 77 per cent. of those aged between 4 and 5 in such places. Yet it must be assumed, on the basis of the statute as it stood, that those places were sufficient. Those who argue that those places are insufficient are in fact saying that it was perfect nonsense to have had a duty written into the law which is not written into the corresponding legislation in this part of the kingdom.
I should have thought that all hon. Members know perfectly well what is the real sanction upon failure to provide nursery places and what is the pressure which will, I am certain, result in a continued expansion of the number


of such places, even under present conditions. It is the determination of parents to secure such places for their children. Those who represent rural areas will be aware of the unceasing pressure exerted by parents upon them and upon others to secure places for their children. Indeed, primary education in the rural areas would be severely lamed if there were not this really very substantial provision, admittedly, mostly not in nursery schools which are no doubt more appropriate to urban areas but in nursery classes in the primary schools.
In short, my hon. Friends and I do not believe that the progress which is necessary will be in any way interfered with or halted—it might even conceivably be the other way round—by the removal of a meaningless duty to provide a meaningless quantum of nursery places.
A word of welcome should be offered to that part of article 9 which takes account of the criticism levelled by the Examiner of Statutory Rules for Northern Ireland at previous regulation-making. The examiner labours diligently in the service of the House and of Northern Ireland. Prom time to time we take a number of his reports together and ventilate them in the Northern Ireland Committee. Obviously that can be done only at relatively long intervals, but his careful examination of orders and his determination to ensure that order-making powers are not misused are of valuable assistance to hon Members in doing what, in the last resort, is our duty, namely, to see that the powers of subordinate legislation are not abused. We should welcome the fact that he has scored the hit that is recorded by article 9.
On article 10 the Opposition spokesman referred to the nineteenth century enactments which were being repealed as spent. He did so with a somewhat derogatory reference to the provision for education in the nineteenth century. Even if it is not necessary for his education, it is desirable to place upon the record that in the middle of the last century public education in the island of Ireland was a whole generation in advance of public education in this country. Those who are familiar with Northern Ireland will be aware that throughout Northern Ireland can be seen the monuments of that provision in the admirable primary schools, built to a similar but not to an invariable pattern, many of them attractive pieces of architecture, which were erected in order to provide public education at a time when that was scarcely dreamt of in this island.

Mr. Dalyell: In England and Wales.

Mr. Powell: I am sorry if I have infringed the susceptibilities of the inhabitants of another kingdom. I could have gone further and drawn attention to the fact that in Wales intermediate and secondary education was long in advance of the corresponding education in England. I was letting this part of the kingdom off lightly, however, and I apologise to Scottish colleagues.

Mr. Pendry: I think that the right hon. Gentleman misunderstood me. I said that at first glance it might appear that this was a progressive measure, but that on further examination it proved not to be so.

Mr. Powell: The hon. Gentleman can be regarded as having made his amende honorable for having failed to take the opportunity to indicate that there was once a period—perhaps still is — when State education in Northern Ireland and Ireland as a whole was setting the pace for other parts of the United Kingdom.
I refer in conclusion, for it is a significant and constitutionally important matter, to the apparently minor articles 4 to 6, which reduce, as the Minister explained, the supervision of the Secretary of State over the administration and performance of their duties by the education and library boards. I am not sure that the trend which is evinced on an extrememly small scale by articles 4 to 6 is one that should be welcomed.
The Minister rightly said that the status of those boards is different from that of local education authorities in the rest of the kingdom in that they are 100 per cent. agents of the Minister in performing the duties and rendering the services for which he is answerable to this House, but perhaps I may illustrate by a certain example what I mean by the real constitutional importance of the point involved.
I had occasion recently to urge upon the noble Lord Elton, who is the Minister responsible for education in Northern Ireland, the desirability of so rearranging priorities of capital expenditure that it would not be necessary to close the learner swimming pool in Downpatrick—an apparently not unimportant, yet not so very major, matter. I received a reply from the noble Lord, from which I shall quote one or two sentences. He said:
I consider that the Education and Library Boards, as the education and library authorities for their areas are in the best position to assess the relative merits of competing local needs and demands, and to decide their own priorities within any guidance given by Government and within the financial resources available.
After further argumentation, he concluded:
In this case I am satisfied that the Board has acted reasonably in its consideration of the matter and I am prepared to accept its judgment of the relative priorities.
I would like the House to linger for a moment on those concluding words
I am prepared to accept its judgment of the relative priorities.
What Minister, writing to an hon. Member of the House or answering a debate in the House, would say of the civil servants in his Department that they had considered the matter very carefully, that they had weighed it up, and that he was prepared to accept their
judgment of the relative priorities"?
No Minister could say such a thing. He would immediately be told that the responsibility was not theirs, but his. That is exactly the position of the Secretary of State in Northern Ireland in relation to every aspect of the education and library service. He is responsible, whether he likes it or not, for the priorities. He is answerable for the decisions that are taken—not only in general, and not only for the broad totals within which the Treasury obliges him to work, but for the decisions that are taken within those totals. He cannot pass that responibility off by saying that the boards are the authorities. The boards are not the authorities in the sense of education authorities in this part of the United Kingdom.
Of course, the boards are composed, for the most part, of admirable people who are well informed, well intentioned and who contribute of their best. That is not the point. The point: is that they are in no position to take responsibility. They have no responsibility to the electorate and they have no responsibility for expenditure. That is not their fault: it is the fact of the position. In so far as decisions on the expenditure of this public money and on the provision of those services in Northern Ireland are taken by boards, those decisions are, in the literal, constitutional sense of the term, irresponsible decisions.
I do not believe that a Minister is entitled, therefore, to shelter behind the views and the judgments of a board. If he cannot accept those judgments and justify them in his own person, he should change them. If he accepts them, he should justify them in his own person without reference to the board.
There is one remedy, and one remedy only, for that constitutional gap. It is that the boards should be given responsibility in the same way as the corresponding local education authorities in this part of the kingdom have responsibility, namely, by the majority of them at least being elected and, consequently, responsible to the electors, and by the expenditure which they control being in part raised upon their authority. Without local election and without local finance there can be no responsibility on the part of local bodies.
I hope that you will not feel, Mr. Deputy Speaker, that this is too large a matter to have been ventilated within the scope of the order. In three of its articles the order is expressly for swearing the responsibility of the Department to supervise the actions of the boards. That may be satisfactory from the point of view of economy and convenience of administration, but the House should be aware that there is an important constitutional principle involved which falls to be dealt with within the contract of Northern Ireland. It falls to be dealt with by giving to the people of Northern Ireland educational administration upon the same basis as education is administered on this island.

11 pm

Rev. Ian Paisley: I associate myself with the remarks of those who have preceded me in congratulating the right hon. Member for Mansfield (Mr. Concannon), who has taken on responsibilities for Northern Ireland as the Opposition spokesman. The people of Northern Ireland know the right hon. Gentleman. They know of his labours, of his energy and of his good will towards them. Although I have had personal differences with him in the past—no doubt I will have in future—I welcome his appointment. We regret that his appointment means that his colleague, the hon. Member for Pontypridd (Mr. John), will speak no longer for Northern Ireland. The hon. Gentleman took a keen interest in the Province and set out to ascertain the views of all parties in the Province.
I cannot accept the thesis of the right hon. Member for Down, South (Mr. Powell) that because the statutory obligation on the boards was not fully carried out it will help them to carry out their responsibilities if we make them discretionary. The figures that have been placed before us—namely, 500 places in every 10,000—indicate that there are not sufficient places in nursery education in Northern Ireland. If the boards were not prepared to shoulder their responsibilities and to discharge them when they had a statutory obligation to do so, we cannot expect them to become over-excited, to take off their coats and to roll up their sleeves when they operate on a discretionary basis.
The figures for the 3 to 5-year-olds are serious. They reveal that Northern Ireland has been neglected in nursery education and will be more neglected in future. The hon. Member for Stalybridge and Hyde (Mr. Pendry) spoke of the black backcloth of the social environment in Northern Ireland. It should be known to hon. Members that many

mothers who would like to stay at home to look after their young children are forced to go out to work to try to bring up the family budget to a level that will enable them to bring some comfort to their family. This is an important issue that should not be passed over.
The Government are not helping by bringing forth this order. The original draft order was even more serious, because it would have taken away the free transport from children attending primary and secondary schools. We are grateful to the other place. Some people would like to abolish it. However, I am pleased that it has not been abolished and was able to deal with the matter. The people of Northern Ireland owe a debt to the other place. Bills have gone through this House in years gone by that were killed in the other place. I am glad that that provision was, too.
Promises have been made to rural schools in Northern Ireland that if they close certain privileges will be guaranteed and the children will be transported to the schools that they will be forced to attend. Those promises would have been in jeopardy.
We should emphasise that we are very concerned about the decision under article 3. I do not agree with the right hon. Member for Down, South about article 3, but I agree about the other three articles. I, too, do not like the fact that the Minister seems to be contemplating passing the buck. He would be able to say in reply to representations that it was a decision of the board. Public representatives in Northern Ireland are sick, sore and tired of Ministers saying that this or that is a board decision. They cannot defend the decision when faced with the facts.
I do not agree that the people who comprise the boards are well informed and well intentioned. Many are neither. Those of us who have experienced rural schools being closed have been amazed to find board members who do not even live in the area, and some have never had a family. They are either bachelors or spinsters. They take great delight in closing down rural schools. Such people should not be on the boards.
It is amazing that if someone loses an election in Northern Ireland and happens to belong to the Alliance Party he will be nominated to the education board. I could give illustrations. A defeated candidate who is approved of by the Minister will have strings pulled to get him on to the board. That person is not elected, but gets on the board by a co-opting system. I totally oppose such practices.
The remedy is a return to proper devolved government in Northern Ireland. The system that resulted from the report should be tied in to a proper local structure.

Mr. Goodhart: A number of hon. Members have referred to the article that got away—the article in the original draft, which related to school transport and charges thereto. The hon. Member for Antrim, North (Rev. Ian Paisley) and the right hon. Member for Down, South (Mr. Powell) reminded the House that the clause in the Education (No. 2) Bill was removed in another place. Perhaps those in another place were influenced not by the powerful speech that I made on Second Reading but by that of the hon. Member for Antrim, South (Mr. Molyneaux). Anyhow, I would not wish to take credit from him on that point. He made a most powerful point.
There has been an alliance between the hon. Gentleman and the right hon. Gentleman in casting doubt on the


Government's intentions with regard to articles 4, 5 and 6. It has been suggested that we are trying to pass the buck without transferring real powers to the library boards. We are not trying to pass the buck, but we are trying to cut down on the passing of letters. It does not seem to be sensible that every item relating to a change in the fine for the non-return of a book to a library or every item for the arrangement of an education conference should have to be referred from the education and library board to the Department of Education, it is sensible to leave decisions on these matters to the library boards, and thus reduce, an excessive volume of administration.
The hon. Member for Stalybridge and Hyde (Mr. Pendry) took leave of his normal good common sense when he suggested that the education and library boards were likely to make good any deficiencies in their financial allocations in the coming year by imposing draconian fines on those who were a little ate in returning their books to the library shelves. I think that one can trust the good sense of the ladies and gentlemen concerned. Perhaps one or two have been unsuccessful at district council elections at some time in the recent past.
However, most of the discussion on this order has naturally turned on article 3. The right hon. Member for Down. South was right when he said that the legal requirement to provide nursery places for every child in Northern Ireland—as for every child in the rest of the United Kingdom—as was the case before the passage of the Education Act 1980, was a bogus right, which no one had believed existed. However, there can be no doubt that once that legal obligation had become common knowledge the library boards and the Government would have been open to litigation. While the existence of this legal right would not have provided a single nursery school place, it might have provided a large number of legal cases, which would have taken a great deal of time to sort out.
The hon. Member for Stalybridge and Hyde quite rightly drew attention to the fact that the need for education at the pre-5-year-old level is greater in Northern Ireland than it is elsewhere in the United Kingdom. He went on to parade some statistics, and suggested that provision for the education of the under-fives was grossly lacking. When one takes into account the provision that there is for under-fives in the primary schools, the position in Northern Ireland can be seen to be a great deal better than it is elsewhere in the United Kingdom.
In England, the provision for the under-fives is for 58 per cent. of the children, whereas in Northern Ireland it is for 77 per cent. The differential is most certainly in favour of Northern Ireland, and I have no doubt that when we consider the allocation for education in Northern Ireland For the coming financial year we shall find that that differential in favour of Northern Ireland will be maintained, and even expanded.

I commend the order to the House.

Question put and agreed to.

Resolved,
That the draft Education (Northern Ireland) Order 1980, which was laid before this House on 28 October 1980 in the last Session of Parliament, be approved.

ANGUILLA BILL [Lords]

Ordered
That, in respect of the Anguilla Bill [Lords].notices of Amendments, new Clauses and new Schedules to be moved in Committee may be accepted by the Clerks at the Table before the 3ill has been read a second time.—[Mr. Cope.]

North Ayrshire District General Hospital

Motion made, and Question proposed. That this House do now adjourn.—[Mr. Cope.]

Mr. William McKelvey: I welcome the opportunity to debate the question of the protracted delay in the building of the North Ayrshire district general hospital, and I am particularly glad to see among my Scottish colleagues those of my colleagues from Ayrshire. I hope, Mr. Deputy Speaker, that in the course of the debate my hon. Friend the Member for Central Ayrshire (Mr. Lambie) may catch your eye.
This project for a new 700-bed hospital was initiated by the former Western region hospital board and design team that was appointed in March 1965. Work then started on the site in August 1972, and the projected date of completion was to be around May 1977. However, on 19 March 1979 the local health council requested the Secretary of State to hold a public inquiry into the delay in hand-over and commissioning of the North Ayrshire district general hospital.
The response from the Scottish Home and Health Department of 4 May 1979 was that
a public inquiry can elicit much information, but its proceedings are likely to be protracted and might not directly assist (indeed, might even prejudice) the Health Board's chances of recovery of excess costs from offending parties. The Board has given priority to ascertaining what is technically wrong at the hospital and to finding means of putting the problems right, while at the same time attempting both to establish responsibility for the problems and to maintain as far as possible, their rights to appropriate legal action. In these circumstances, it is not considered appropriate to consider further the question of a public inquiry at this stage.
I believe that a similar type of reply was given to my hon. Friend the Member for Central Ayrshire when he asked a parliamentary question on 23 May 1979.
Those requests had been prompted when, on 27 November 1978, the Ayrshire and Arran health board issued a press release announcing that there would be at least a six-month delay in the hand-over to the North Ayrshire district general hospital. The main reasons for the delay were identified as involving two areas. First, there were serious plumbing problems in the form of unacceptably high levels of lead and copper in the water supply. I understand that the technical reason for that was that earlier plumbing had been dealt with and some solder had got into the water supply. I am glad to say that that was cured by the perpetual running of water over a period of some months.
The second and more serious problem concerned the ventilation system to the main five-storey ward block and to the main theatres. At that time, Mr. Carson — the area health board chairman—stated:
The Board cannot accept a building which has identifiable problems of such a worrying nature.
No one could blame him for that. Indeed, we share his concern. The problems were much more serious than had first been envisaged.
On 28 September 1979, the Ayrshire and Arran health Board issued a press release indicating that it would be at least 18 months before the North Ayrshire district general hospital was commissioned. In fact, the health board hoped that the remedial work required and some additional


work would be carried out at the same time, thereby, it was hoped, reducing the time lag, then estimated at three years, to 18 months.
Again, there was a press release dated 17 April 1980. It stated:
It was seven months ago when the Board announced it would be 18 months to three years before the hospital would take its first patients.
In July, the first part of the hospital complex, the college of nursing and the administration blocks, were handed over and brought immediately into use. The new hospital was to serve North Ayrshire and would allow the closure of Torrance House — a small hospital with limited resources — and the closure of Kilmarnock infirmary, which has a capacity, at present, of about 130 beds. It is well over 100 years old and is totally inadequate and unsuitable by modern standards.
Since the new hospital was expected to open in 1977, few or no improvements have been made to the deteriorating and overcrowded conditions that prevail in Kilmarnock infirmary. Consequently, the entire staff are valiantly struggling against mounting difficulties in order to maintain a reasonable standard of patient welfare. One can imagine the despair felt by these dedicated people in such conditions. Since further delays will affect them, they will not move to the new hospital for about three years. Since the Government have embarked on an all-out austerity programme, they have little hope of any money being spent on improving the conditions at Kilmarnock infirmary. It would be particularly unwise to spend large amounts on that area, because a fairly short period of time might be involved.
It is a scandal that we should play on the fact that such workers are prepared to put up with intolerable working conditions because they are responsible for their patients. They put the welfare of their patients before their own. Among the workers and all the senior staff in Kilmarnock hospital, there is growing concern that out-of-date machinery is beginning to break down. That gives rise not only to serious concern about the patients in Kilmarnock infirmary but to delays for those waiting for treatment or operations.
The main design fault was apparently in the ventilation system, which proved to be inadequate and did not comply with the necessary high standards of today. The extensive remedial work will mean that this brand new building will not be fully operational until March 1982. It is almost five years behind schedule. It is an indictment of the original designers that the capital building costs of £9 million have obviously soared during the delay. I shudder to contemplate what the final bill will be. I am not sure what the present estimate is. As a result of inflation, I am sure that several millions of pounds have been added to the bill.
It is much more difficult to estimate the social cost, which cannot be measured in pounds. People will undoubtedly be in difficulties. Patients who need the facilities of the new hospital will be denied them for some time to come.
I should like to ask a number of questions, which I hope will be answered tonight. I begin with what is virtually a plea from the local health council, which asks when, oh when, the North Ayrshire district general hospital will be open to accept patients. Fears are now being expressed that it may be as late as the autumn of 1982 before patients will

be admitted. Some people feel a growing concern that by the time the hospital is open the estimated cost of running it will be more than £12 million a year. There might well be no cash available to open it, so in 1982, when eventually—five years behind schedule—we have this fine hospital, there may well be no money to staff it. Then we shall have to return to the almost Dickensian conditions in Kilmarnock infirmary and try to make some improvements there.
Secondly, why were the problems in the ventilation system in particular not recognised until after the due completion date of May 1977?
Thirdly, it is understood that the area health board will be going to litigation. Indeed, a writ was served on the consulting engineers in September. Why has it taken so long for this action to be raised?
Fourthly, what part, if any, has the Common Services Agency played in this long-drawn-out affair? Who in that body is responsible for overseeing the condition of the project? The agency is evidently the scrutineer of any plans or projects such as the North Ayrshire district general hospital.
Fifthly, will the Secretary of State hold a public inquiry into the whole affair? If, for reasons previously stated, this might in some way prejudice the health board's chance of getting back some of the money spent because of the errors, will the Secretary of State be prepared to set up a commission to investigate hospital building, not only at the hospital in question but throughout Scotland?
There has been a catalogue of disasters in new hospital building. It is passing strange that in this age of technological advance we seem, particularly in Scotland, unable to produce consulting engineers who can design and build a proper facility. We have had trouble at Ninewells, Inverclyde Royal, the sick children's hospital in Glasgow, which some people say is virtually falling apart, and the hospital that we are debating.
I look forward to the Minister's reply.

Mr. David Lambie: I am grateful to my hon. Friend the Member for Kilmarnock (Mr. McKelvey) for allowing me to take part in this short debate. I am glad to see that my hon. Friend the Member for South Ayrshire (Mr. Foulkes) is also present, because, as an Ayrshire Member, he is concerned about the delay in finishing the North Ayrshire district general hospital, which will serve the whole of Ayrshire.
I should like to add my voice to the demand for a public inquiry, not only into the delay in completing the North Ayrshire district general hospital but into hospital building in general in Scotland. My hon. Friend mentioned the Ninewells hospital in Dundee, which took 10 years to build. The original estimated building time was four years and the initial cost was estimated to be £10·2 million. The final cost was £19·5 million. The tremendous delay has resulted in increased public expenditure, which the Undersecretary is always telling us the Government want to cut.
The twenty-fifth report from the Committee of Public Accounts for 1979–80, dealing with the Royal Hospital for Sick Children in Glasgow, told us that the site works there started in July 1968. The planning team started work in November 1965. That hospital should have been commissioned in 1971, but remedial work is still being carried out. The Committee carried out an investigation and took oral evidence on the reason for the delay.
Following the evidence that was given to the Committee, we were told that the original cost was £4½ million. The repair cost is £7¼ million, nearly double the initial cost of the project. That is why people in Scotland are becoming disturbed about what is happening to hospital building in our country.
Much the same comments apply to the hospital that is the subject of the debate, and we have raised these matters because of pressure from local people and the local health council. No one seems to know what is going on. The Minister must tell us tonight what is going on so that not only do we know what is happening but the information is available to our constituents and the health council.
In February 1976 the cost of this hospital was estimated at £9½ million. What is the estimated cost now? A press statement issued by Ayrshire health board on 17 April 1980 carried a statement by the chairman of the board, Mr. Carson, a friend of my hon. Friend on the projected programme of corrective and post-contractual work. It said:
Mr. Carson emphasised the boldness and imagination of the proposed scheme, and went on: 'We have reached this stage only with the willingness and co-operation of everyone concerned—the design teams, the main contractor and the engineering sub-contractors, the Common Services Agency and our own staff. No one should underestimate the complexity of integrating the various works'.
That statement was made eight years after the commencement of the hospital, and now we are getting this great enthusiasm about what is to be done through cooperation. The Minister should tell us why there was not this co-operation eight years ago. Why has the design team been sacked? Mo one knows that the design team has been sacked. Everyone is afraid to say that that is the case. I am laying tonight that the original design team has been sacked, and the Minister has to verify that statement.
Not only has the original design team been sacked, but, as Mr. Carson said on 17 April, a new design team has been appointed. Everyone is enthusiastic now and they will get on with the hospital, but when will it be opened? On the last occasion on which the House dealt with Scottish questions, in reply to a question that I asked about the-completion date I was told that it was hoped to open the hospital in the autumn of 1982—10 years after the start of the hospital.
I ask the Minister to deal with the matters raised by my Ion. Friend. The Common Services Agency's building division is concerned with the design, building and commissioning of new hospitals. It acts as agent for both the Secretary of State and the health boards. It is supposed to provide information, advise the health boards and build projects. It can supply architects, design staff and so on on it may appoint private firms to do the work. It does all that, but major building projects must be authorised by the Scottish Home and Health Department.
The design team has been sacked. That was necessary and should have been done years ago. I want to know, as did certain members of the Public Accounts Committee, who in the Common Services Agency is responsible for what has been done. My hon. Friend the Member for Fife, Central (Mr. Hamilton) asked about the chief architect in the CSA. Has he been sacked? Has anyone else been sacked for this catalogue of disasters? Has anyone in the Scottish Home and Health Department been sacked? There has been a tremendous increase in the costs of these projects. Money has been wasted. People have been paid

for doing jobs that they did not do. Have any of the people concerned in the Scottish Home and Health Department been sacked?
Is it not possible to ask the Select Committee on Scottish Affairs to take evidence on the activities of the CSA in regard to this hospital? The Minister has a tremendous responsibility in this matter. Public money has been wasted in Dundee and Glasgow, and now in Ayrshire. He must speak up and give us answers that we can give to our constituents.

The Under-Secretary of State for Scotland (Mr. Russell Fairgrieve): I am grateful to the hon. Member for Kilmarnock (Mr. McKelvey) for giving us the opportunity to discuss briefly this evening the problems that have arisen at this hospital. I am also glad that the hon. Member for Central Ayrshire (Mr. Lambie) has caught your eye, Mr. Deputy Speaker.
As the hon. Member for Kilmarnock will know, I have had the pleasure of visiting the hospital. It is not yet opened, but it is a most beautiful and attractive hospital. It is far from obvious to the outsider why it cannot be occupied at once. It is regrettably true, however, that the problems with the ventilation system do not permit this. The air conditioning, for that is what we are talking about, is just not up to the job, even when turned to full power: and when that is done the noise level in the wards is intolerable.
There is a lot that I should like to say in the limited time available to me in this debate, but I feel I am duty bound to answer first some of the questions put to me. Thereafter, I may try to make some general remarks about the hospital.
I will try, first, to answer the questions put to me by the two hon. Members. Obviously, the questions overlap. I, as a layman, have asked time and time again why it is taking so long to get the wards open at this hospital. The clinical considerations govern the doctors' views of when the theatres should be opened. They do not want the wards opened with patients there before the theatres are ready. We are quite correct in that regard in thinking of early 1982, although the nurses' section and the administrative block are open now.
As regards costs, I am glad to say that in respect of this hospital the final cost in real terms is coming out at some £21 million and the remedial works themselves are expected to cost only about 1 or 2 per cent. of this figure.
Why were not the problems with the ventilation discovered earlier? Those of us who have had a Jot of experience in industry—it is rather like building a car or anything else — know that until the whole thing is switched on one does not find out the faults. Until the whole lot was switched on, it was not found that the ventilation was not working. I am glad that the hon. Member agreed that: in the case of the water what was needed was turning the taps on and letting them run. It was not a question of late action. Action was taken immediately the faults in the ventilation system were discovered.
The CSA came into the picture only in 1974, long after the hospital had started to be planned and built, when the reorganisation took place. The CSA is an advisory body and not an executive body.

Mr. George Foulkes: I do not think that it is so easy to gloss over the role of the Common


Services Agency so lightly. Does not the Minister think that it might be much simpler for health boards to deal with the design team and the builders direct without the intervention of the CSA and that the intervention of that third arm causes confusion, delay and difficulty? Will he take account of that?

Mr. Fairgrieve: I shall take account of that. However, I cannot accept the argument. The CSA is there to help. Health boards are dealing with the design team and the subcontractors direct. The CSA is there for advice if so required. The CSA is not part of the Department. It is part, basically, of the Health Service. The health board is not dissatisfied with the role that the CSA has played in this matter. Therefore, I suggest that the hon. Member take up the question of the CSA with the health board itself.
As regards the public inquiry, time and time again we have explained that the object of the health board, the people in Ayrshire and the Department is to get this hospital commissioned as soon as possible. A public inquiry would definitely cause delay. It would also prejudice the action that we have already taken so that those who have caused this problem can be brought to some form of justice — which will be done. We have issued a protective writ, so we are not time barred.
Mention was made about hospital building being a catalogue of disaster. I must deny this. There have been far more problems south of the border than we have had in Scotland. There have been only three, shall we say, disasters: the one that we are discussing, Ninewells at Dundee and the sick children's hospital, Glasgow.

Mr. Lambie: That is more than enough.

Mr. Fairgrieve: As a proportion of the number that we have built since the Second World War, it is not bad going for the course. Every one of these can be put down to trying to take short cuts. Dundee was design and build, for political reasons. Yorkhill's problems arose out of political reasons—"We must build it immediately." The problem in this instance was not a mistake but, as we have said, a fall-out within the design team.
The design team has not been sacked; it has been changed.

Mr. Lambie: Disappeared.

Mr. Fairgrieve: It has not disappeared. Three-quarters of the design team members are the same. There have been changes in the design team. Some of its members are no longer with the team. The team has not been sacked; it has been changed by up to one-third of its members.
Let us get the facts right before we go rushing round in various devious channels which are not always strictly factual. I have mentioned the public inquiry and Dundee. I have also referred to what is going on. I regret that the hospital will not be open to receive patients until 1982. I have made inquiries.
There is no question, as has been suggested, of the hospital not being able to be run by the board. The finance is available. The board is at the top end of the Scottish health authorities' revenue equalisation programme. The hospital has no problem of not being fully commissioned. Therefore, that gets another canard out of the way.
Having answered the questions that were put to me, I think that I am now entitled to make some remarks on how we are progressing.

Mr. Lambie: What about the Select Committee?

Mr. Fairgrieve: I have been asked whether there could be a public inquiry into the whole principle of hospital building in Scotland. I have already given our fine record compared with the rest of the country and the reasons why we have trouble in three hospitals. The Secretary of State asked for a seminar in the Scottish Office, during which he spent three hours looking into the whole question of hospital building, commissioning and so on in Scotland. A very detailed exercise was carried out on that score. I hope that hon. Gentlemen are satisfied on that point.
After we changed the design team, it was necessary for the firm to look into the whole problem, find out what was there and what was wrong with it and make recommendations on how to put it right. This may be old hat to Opposition Members, but I still think that we should put it on the record. The health board was aware that this was likely to be a lengthy process and was very keen to make an early start on using the hospital. Hence, it agreed that there would be a phased hand-over with departments being transferred to the board for commissioning and subsequent bringing into use as necessary remedial works were completed.
The first departments—this is often forgotten—were handed over on schedule. That was not mentioned by the two hon. Gentlemen who spoke tonight. These were the administration block and the college of nursing, and they have now been in use for some months. Thereafter the design team found it necessary to revise its original handover programme. As I said earlier, the board members insisted on meeting the design team and the CSA building division to discuss the problems and the reasons for the slippage. They were most concerned to know whether there would be any further slippage. Those meetings duly took place. The consulting engineers naturally felt unable to give any absolute guarantees but satisfied the board that, in their opinion, the majority of the problems had now been diagnosed and that the new timetable would be met. This envisages the ward blocks being handed over to the board in February and April 1982.
It is not for me to say, but we are trying to do everything that we can to advance that date. A period of commissioning is then necessary, but the hope is that the first patients can be admitted some six months thereafter. I should like to mention at this point that current indications are that good progress is being made and that the timetabling is being kept. I can assure hon. Members that the health board is pressing vigorously for the work to be completed as soon as possible. It had been struggling for this for some time, and it is its wish that this fine new hospital, which I have had the pleasure of going round, should be brought into use as soon as possible.
There is absolutely no truth in the suggestion that the board has been dragging its feet because it considers that it cannot meet the running costs of the hospital.

Mr. McKelvey: Will the Minister deal with the question of Kilmarnock infirmary and the fate of the patients and staff there?

Mr. Fairgrieve: I cannot possibly go into that question tonight. It is a separate matter. There will be no problem about dealing with patients in the area, if that is what the hon. Member is asking.
The board is quite determined in due course to pursue those who are judged to be at fault. It has taken certain legal steps to prevent the possibility of any actions which might be found necessary being time barred.
I conclude by emphasising the positive situation. All concerned are pressing on as hard as they can with getting this excellent hospital put to rights and into use. They

deserve every encouragement that we can give them. For those reasons, if for no others, I am grateful to the hon. Member for bringing up the subject for debate tonight.

Question put and agreed to.

Adjourned accordingly at fourteen minutes to Twelve o'clock.